Economic performance data for April will be released soon. Recently released data on automobile consumption, newly established tax-related business entities, and newly established private enterprises across the country continue to send good signals of economic recovery.
Experts said that the triple pressure of demand contraction, supply shock, and weakening expectations is being alleviated, and economic development is showing a rebounding trend. However, the current economic development is restorative, and measures to stabilize the economy need to be continuously exerted. The key to the sustainability of the subsequent restoration of residents’ consumption lies in policy support.
The consumer market is booming
The flow of people is like weaving, there is a lot of voices, and service consumption is picking up rapidly; policy support, demand release, and automobile consumption continue to be hot… There are various signs that consumption has shown a trend of accelerated recovery since this year.
Service consumption remained high. Huachuang Securities tracked relevant data and found that in April, the passenger traffic of 29 cities’ subways increased by about 73% year-on-year, and the corresponding catering revenue growth rate is expected to reach more than 40%; the postal express delivery volume increased by 152% compared with March, superimposed on the low base effect, The growth rate of online retail sales in April may have accelerated significantly. The weekly tracking data of Industrial Securities shows that the national migration scale index during the “May 1st” holiday has risen sharply, and the number of tourist receptions and tourism income have recovered to above the level of the same period in 2019; The indicators have also picked up significantly, and the overall level is comparable to that of the same period in 2021.
The growth momentum of automobile consumption is good. According to the National Passenger Car Market Analysis Report released by the Passenger Federation on May 9, the retail sales of the passenger car market in April reached 1.63 million units, a year-on-year increase of 55.5% and a month-on-month increase of 2.5%. The car sales data in May continued the strong momentum since April. According to the report of Huachuang Securities, the number of car retail sales in the first week of May (May 1-7) increased by 46% month-on-month and 67% year-on-year.
“In April, with the improvement of residents’ consumption ability and the continuous effectiveness of relevant consumption-promoting policies, the consumer market has further recovered.” Wen Bin, chief economist of Minsheng Bank, believes that under the low base effect, the year-on-year growth rate of total retail sales of consumer goods in April will be increased by It rose to around 25% from 10.6% in the previous month. The research team of CICC pointed out that, on the whole, the high-frequency tracking index of consumption continues to rise on the basis that the popularity of bulk consumption has picked up and service consumption is still at a high level.
Business entities are active
Changes in the number of market operators directly reflect the improvement in production and operation expectations. According to data released by the State Administration of Taxation on May 11, in April, 1.48 million business entities went to the tax department to handle tax-related matters such as tax identification, invoice receipt, and tax declaration, a year-on-year increase of 28.8%. As of the end of April 2023, there were a total of 86.155 million tax-related business entities nationwide, a year-on-year increase of 7.4%.
Experts said that the number of newly established tax-related business entities has increased, indicating that the business entities are gradually becoming active and the entrepreneurial vitality is effectively stimulated.
It is worth mentioning that the expectations and confidence of private enterprises have steadily increased, the development trend is positive, and the vitality continues to show. According to a Xinhua News Agency report on May 14, in the first quarter, 2.039 million new private enterprises were established nationwide, a year-on-year increase of 10.7%. As of the end of March, there were more than 49 million registered private enterprises nationwide, and private enterprises accounted for 92.3% of the total number of enterprises.
In addition, international organizations and institutions are optimistic about China’s economic development prospects. The latest “Asia-Pacific Economic Outlook” report jointly released by the International Monetary Fund (IMF) and the China Finance Forty Forum (CF40) on May 11 shows that China’s economic growth this year is expected to be raised to 5.2%, higher than the previous forecast. The value was raised by 0.8 percentage points.
“China’s contribution to global growth will reach 34.9%.” The above-mentioned report believes that the restart of China’s economy is crucial to the Asia-Pacific region. Increased domestic demand, especially consumer demand, will be the main driver of China’s economic growth this year.
Implement policies to boost consumption
Experts said that since the beginning of this year, the triple pressure of demand contraction, supply shock, and weakening expectations has been eased, economic growth has been better than expected, and economic development has shown a rebounding trend. However, the current improvement in my country’s economic operation is mainly restorative, the endogenous driving force is not strong, the demand is still insufficient, economic transformation and upgrading are facing new obstacles, and promoting high-quality development still needs to overcome many difficulties and challenges.
Experts believe that with the concentrated release of holiday demand, the key to the sustainability of subsequent residents’ consumption restoration lies in policy support. Luo Zhiheng, Chief Economist and Director of the Research Institute of Yuekai Securities, believes that it is necessary to increase residents’ income, improve the consumption environment, and improve the level of residents’ welfare to relieve their worries. In addition, consumption scenarios can be enriched, and consumption scenarios such as night economy, morning economy, and street stall economy can be expanded. Lian Ping, Chief Economist of Zhixin Investment and Dean of the Research Institute, suggested that a multi-pronged approach should be taken to implement consumption boosting policies. For example, continue to implement car purchase tax reductions, local car purchase subsidies, lower car loan interest rates, and trade-in policies; encourage and support the platform economy to drive online consumption and new consumption; increase the issuance of consumer coupons and discounts, and expand the scope of application.
In terms of enhancing confidence, Luo Zhiheng said that on the one hand, it is necessary to combine the effectiveness of policies with stimulating the vitality of business entities; on the other hand, we should actively support the development of the private economy and platform economy, solve the problem of corporate debt arrears, and boost market confidence .
In addition, all parties expect fiscal and monetary policies to continue to exert force and pay more attention to policy coordination and cooperation. Luo Zhiheng said that in terms of fiscal policy, the issuance and use of special bonds should be further accelerated; continue to implement the tax and fee reduction measures determined in the early stage, and focus on caring for the manufacturing industry, small, medium and micro enterprises, and individual industrial and commercial households. In terms of monetary policy, it should meet the normal financing needs of top real estate companies, support residents’ rigid and improved housing needs, support the green, digital, and intelligent transformation and upgrading of the manufacturing industry, and support supporting financing for infrastructure investment.