Beijing [China], July 26 : Amid dismal economic run and bleak prospects, several Chinese top leaders have pointed out that the Beijing economy is facing "new difficulties and challenges," The Standard Media reported.
The leaders highlighted the concerns in a meeting of the 24-person Politburo on Monday.
The country's highest-ranking officials gather annually at the end of July to review the economic situation before their traditional summer break in August.
The leaders met in 2023 as the post-COVID recovery in the world's second-largest economy was running out of steam, due in large part to sluggish consumer spending, The Standard Media reported.
"The meeting pointed out that the current economic operation is facing new difficulties and challenges, mainly due to insufficient domestic demand, operational difficulties for some enterprises, high risks and hidden dangers in key areas, and a complex and severe external environment," The Standard Media quoted a readout of the meeting on state broadcaster CCTV.
The Politburo agreed on Monday that Beijing must "implement precise and effective macroeconomic regulation, strengthen countercyclical regulation and policy reserves," according to CCTV.
The meeting, headed by President Xi Jinping, also called for efforts to expand domestic consumption and "adjust and optimize real estate policies in a timely manner," it added citing CCTV.
A run of dismal economic data over recent months has ramped up calls for officials to unveil support measures.
Beijing's economic growth in the second quarter was much weaker than what was expected. The disappointing result came in spite of the very low base of comparison with last year, when the country was hit by a series of COVID lockdowns in major cities, The Standard Media reported.
Notably, if one looks in quarter-on-quarter terms — considered a more realistic basis for comparison — growth comes at 0.8 per cent, well down from the 2.2 per cent seen in January-March, the first full period after the removal of zero-COVID restrictions.
Also, youth unemployment jumped to a record 21.3 per cent in June, up from 20.8 per cent in May.
In addition to this, the property sector remains in turmoil, with major developers failing to complete housing projects, triggering protests and mortgage boycotts from homebuyers, The Standard Media reported.
While the People's Bank of China last month cut interest rates and authorities pledged to help the troubled property sector, there has been very little concrete action out of Beijing.
"The key to watch from the meeting is not specific policy measures, but the policy tone set by top leaders," The Standard Media cited a note written by Macquarie economist Larry Hu.
"The government mentioned 'strengthening countercyclical policies' but the tone related to fiscal and monetary policies seems not significantly different from before," The Standard Media quoted Zhiwei Zhang, chief economist at Pinpoint Asset Management.
Zhang said the call to support the property sector appeared to show that the government has "recognized the importance of policy change in this sector to stabilize the economy."
"We don't expect policymakers to unleash a bazooka-like stimulus package," Hu of Macquarie said. "More likely, they would continue to roll out stimulus measures in a piecemeal way."
Meanwhile, in a bid to counter the situation, China unveiled several measures to encourage the purchase of automobiles, while other measures have also been announced to promote artificial intelligence and electronics consumption.
Beijing is aiming for about 5 per cent growth this year, which happens to be one of the lowest targets set by the Asian giant in decades, and one that Premier Li Qiang has warned will not be easy to achieve, The Standard Media reported.
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