context: The fact that stability has become a keynote of China's economic policy belies Beijing's rhetoric that China has made a strong recovery from the pandemic. Challenges are significant given domestic structural problems and worsening external relations.
Twenty-seven provinces have already held the 'Two Sessions' and issue their government work reports and economic data. Most provinces have set the GDP growth rate below 7 percent, and localities are seeking to expand effective investment in infrastructure while promoting various forms of consumptions to boost economic recovery, observes 21st Century Business Herald.
But at least 10 provinces expect their GDP growth to be 7 percent or above. Henan, Yunnan, Guizhou and Ningxia expect GDP growth to be around 7 percent. Anhui, Jiangxi, Tibet, Jilin and Hainan predict their growth will be above 7 percent. Eight in 10 of these provinces experienced growth not lower than 7 percent in 2021.
Localities propose greater tax and fee cuts to stimulate the economy. Specifically
- Henan proposed to implement new tax cuts and withheld VAT refunds
- Jiangxi will cut C¥200 bn in taxes for 600,000 companies
- Shaanxi pledged to release policy combos to alleviate tax burdens for market actors
- Ningxia will support eight manufacturing champions and 10 specialised 'small giants'
Provinces also prioritised consumption recovery in their 2022 agendas
- Henan promised to stabilise bulk commodity consumption in automobiles, household appliances and furniture, promoting Zhengzhou and Luoyang as international consumption hubs
- Jilin will develop tourism and e-commerce to expand new-type consumption
- Anhui focuses on urban consumption upgrades through building multi-layered consumption centres
Guangdong, Jiangsu, Zhejiang, Hubei, Shanghai, Beijing, Anhui and Chongqing all promise to expand government investment in a forward-looking way. Specifically,
- Shanghai highlighted investment in transport, energy, environment and infrastructure upgrades
- Beijing pledged to maintain a hundred-billion investment intensity
- Anhui emphasised the importance of effective investment
- Shaanxi will invest in 5G, new-gen internet and the internet of things
- Guangdong will accelerate scitech and R&D investment