China establishes task forces to boost roll out of stimulus measures

China’s State Council has set up regional task forces to speed up the roll out of the government’s economic stimulus policies and tackle local problems.

And the Council is calling on the provinces with larger economies to take the lead in bolstering the country’s growth during a period of downward pressures, after key indicators slowed in July.

A recent executive meeting of the State Council unveiled 19 follow-up measures on top of the policy package for stabilizing the economy announced earlier in the year.

Liu Dian, an associate researcher at Fudan University’s China Institute, said the setting up of the task forces was necessary because of shrinking demand, supply chain problems, weakening expectations and economic uncertainties both at home and across the globe. Sending task forces out to assist areas in need of help “will strengthen active interaction between the central and local governments, which will help optimize official mechanisms and inject new impetus into the economy”, Liu said.

A task force headed by Wang Guanghua, minister of natural resources, is already at work in East China’s Jiangsu province.

Wang said the task force will work with the local government to speed up the implementation of stimulus policies, strengthen the foundation for recovery and help solve problems in terms of expanding investment and financing, and improving the efficiency of approval mechanisms.

Ni Hong, minister of housing and urban-rural development, is leading another task force to Xiamen, Fujian province. Ni said that he expects to see more local efforts to stabilize employment, boost investment and spur consumption.

Yi Gang, governor of the People’s Bank of China, the central bank, heads a group in Henan province. Yi said at a meeting in Zhengzhou, capital of Henan, that the group will increase support for Henan and said he expects the province will prepare more projects, enhance its capabilities in building projects and raw material supplies, and accelerate the progress of projects.

A meeting of the Political Bureau of the Communist Party of China Central Committee decided that the more powerful economical provinces should spearhead recovery in the second half of 2022.

Premier Li Keqiang said China’s six economic powerhouses “must further tap into the potential of their policies, protect market players and stabilize growth”. The six provinces in question – Guangdong, Jiangsu, Zhejiang, Shandong, Henan and Sichuan – account for 45% of China’s GDP and more than 40% of jobs.

Fudan University’s Liu said the six key provinces play an important economic role, and the intensified government efforts are sending positive signals for stabilizing expectations.

The economy will stabilize when the stimulus packages start taking effect, Liu said, and he called for more efforts to ramp up digital economy and boosting environmentally friendly development.

 

China increases trade with ASEAN

Trade between China and the ASEAN reached $544.9 billion in the first seven months of this year, the country’s commerce ministry has announced.

It is up 13.1% year-on-year, and accounts for 15% of the country’s total foreign trade, according to Li Fei, assistant commerce minister of China.

Meanwhile, Chinese companies have been making steady progress in contracting infrastructure projects in ASEAN countries, worth a cumulative $380 billion as at the end of July.

“China will roll out measures, including professional online and offline trade matching and investment coordination services, to facilitate cooperation with ASEAN amid the upcoming 19th China-ASEAN Expo,” said Li.

Customs clearance, transportation, purchasing, and duty-free services will be provided for commodities to be exhibited from ASEAN countries, he said.

The 19th China-ASEAN Expo will take place from 16 to 19 September in Nanning, the capital of South China’s Guangxi Zhuang autonomous region.

China has remained the largest trading partner of the Association of Southeast Asian Nations (ASEAN) for 13 consecutive years.