Policy body urges China to confront economic challenges, confident of demand recovery

China’s top economic policy coordinator has urged the country to confront unavoidable challenges, while expressing confidence that investment and consumption growth will recover next year as efforts to boost domestic demand intensify.

An unnamed official from the Office of the Central Financial and Economic Affairs Commission said the current challenges were “issues arising in the course of development and transition”.

“[They] cannot be avoided or sidestepped, but with effort they can be resolved,” the official said in an interview focused on last week’s tone-setting central economic work conference that was published by Xinhua on Tuesday, citing headwinds ranging from pronounced domestic imbalances between supply and demand to persistent risks in key areas.

China’s leadership has reiterated the need to boost domestic demand amid expected external uncertainties, but November retail sales recorded the slowest year-on-year growth since the country lifted Covid-19 pandemic restrictions three years ago, underscoring persistent challenges.

“We have also noted that growth in consumption and investment has slowed in recent months, and there is a need to continue stepping up efforts to expand domestic demand,” the official said.

The official added that investment and consumption growth was expected to recover next year, pointing to a “bright” economic outlook and “sufficient conditions to drive sustained growth in domestic demand next year”.

South China Morning Post