China issues 11-point policy package to boost consumer spending amid slowing retail sales

China has announced a new policy package to boost household spending by tightening coordination between commerce and financial regulators, expanding access to credit and promoting new forms of consumption.

The move comes as soft retail sales and weak consumer confidence continued to weigh on economic growth last month, highlighting the urgency for policymakers to expand domestic demand. That priority has topped the agenda of the central economic work conference – an annual gathering of the Central Committee of the ruling Communist Party and the State Council, China’s cabinet – for two consecutive years.

Analysts said the support could intensify in the new year, with the focus likely shifting towards service-sector spending rather than big-ticket goods.

The 11-measure policy package includes steps to further expand personal consumer lending and channel more credit towards high-potential areas – including green, health, digital and “AI Plus” consumption – according to a notice released by the Ministry of Commerce, the People’s Bank of China and the National Financial Regulatory Administration.

It also encourages eligible local governments to use digital yuan “red packets” to improve the effectiveness of consumption incentives.

“Local commerce authorities are encouraged to make full use of existing funding channels, actively roll out consumption-boosting initiatives, and work in tandem with financial support measures to better unlock consumer demand,” the notice issued on Sunday said.

South China Morning Post