The Chinese Communist authorities are struggling to “rescue the economy,” as the latest economic data falls short of expectations. With limited time left in the year, members of the State Council of the Chinese Communist Party have been dispatched to various regions to conduct “research,” urging the implementation of incremental policies to stimulate economic recovery. However, some analysts believe that China’s economic problems require political reforms, which the Chinese Communist Party is unlikely to achieve.
According to a report by “Beijing Youth Daily,” the working trends of deputy prime ministers and state councilors of the State Council of the Chinese Communist Party were summarized by the media outlet “Political Insights,” which is under the umbrella of the newspaper.
From October 14th to 17th, Deputy Premier Ding Xuezhang conducted research on economic operation in Henan and Jiangsu provinces; from October 10th to 12th, Deputy Premier He Lifeng visited Shanxi Taiyuan and Shaanxi Xi’an to study the real estate market; from October 14th to 16th, Deputy Premier Zhang Guoqing researched the manufacturing industry in Hunan; and from October 14th to 17th, Deputy Premier Liu Guozhong went to Chongqing and Hubei for research on agriculture.
In addition, from October 15th to 16th, State Councilor Wang Xiaohong conducted research on the so-called “service guarantee for high-quality economic development” in Tianjin; from October 14th to 16th, State Councilor and Secretary-General of the State Council Wu Zhenglong conducted research on policy implementation in Shandong and Jilin; and on October 18th, official reports stated that State Councilor Shen Yiqin had recently conducted research on cultural tourism and civil affairs in Hainan.
Official reports claimed that the high-level visits to various regions were for the purpose of “guidance and supervision” to intensify efforts in promoting the implementation of comprehensive incremental policies.
It was mentioned in the report that all seven high-ranking members of the State Council emphasized the need to “promote sustained economic recovery and strive to fulfill the annual economic and social development goals.” The authorities set this year’s economic growth target at around 5%.
Official figures released by the Chinese Communist Party on October 18th showed that China’s economy grew by 4.6% year-on-year in the third quarter of this year, marking the slowest growth rate since early 2023, and the third consecutive quarter of decline. The authenticity of economic data released by the Chinese Communist Party has been questioned by the international community due to its history of fabrication.
The situation in the real estate industry is particularly bleak. Official data indicates that in September, the average housing prices in 70 large and medium-sized cities in China continued to decline year-on-year. From January to September, the sales of newly built commercial housing decreased by 22.7%, with residential sales dropping by 24.0%.
Despite multiple rounds of policy support measures implemented by the Chinese Communist Party over the past year, the real estate market has shown no signs of recovery. Data on October 18th showed that housing prices in China have experienced the fastest decline since May 2015.
Professor Xie Tian from the School of Business at the University of South Carolina Aiken told “Epoch Times”: “Because the homeownership rate in China is said to be as high as 90%, most people who can buy a house have already done so. Even with current policies such as lowering loan interest rates and down payments, there is not much appeal for these individuals.”
Furthermore, according to recent data released by the National Bureau of Statistics of China, in September, the Producer Price Index (PPI) for industrial producers in China dropped by 2.8% year-on-year, hitting a new low in six months. The Consumer Price Index (CPI) in China’s inflation rate also decreased by 0.2 percentage points compared to August.
Since the end of the “zero-COVID” policy, the Chinese economy has remained weak. The Chinese authorities have rolled out a series of policies before the end of September, including interest rate cuts, reserve requirement ratio reductions, lower mortgage rates, and an 800 billion yuan (RMB) policy toolkit, which temporarily boosted the stock market. However, after the “Golden Week” holiday, the stock market experienced another sharp decline. Despite various government departments holding press conferences to announce policies, the public remains skeptical, and the stock market remains volatile.
On the 17th, the Ministry of Housing and Urban-Rural Development and the Ministry of Finance of the Chinese Communist Party held a joint press conference on stabilizing the real estate market, proposing the addition of one million sets of urban village and dilapidated house transformations through monetary methods, and increasing the credit scale for “white list” projects to 4 trillion yuan. However, mainland and Hong Kong stock markets reacted poorly to the announcements, with real estate stocks notably tumbling.
On October 21st, the Shanghai Composite Index fluctuated downwards and nearly approached its low point of 3200.
Researcher George Magnus from the University of Oxford described the recent large-scale economic stimulus by the Chinese Communist Party as a “bazooka-style” stimulus plan, stating that while it may yield short-term effects, it is ultimately ineffective in the long run.
George Magnus recently wrote in The Guardian, stating, “China’s problems require structural or fundamental economic reforms, which necessitate political changes, something inconceivable for its Leninist government.”