Home » China’s economy continues to deteriorate. Xi Jinping orders consumer goods to be replaced with new ones | China’s economic depression | Investment and consumption | Chinese Communist Party leader Xi Jinping

China’s economy continues to deteriorate. Xi Jinping orders consumer goods to be replaced with new ones | China’s economic depression | Investment and consumption | Chinese Communist Party leader Xi Jinping

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China’s economy continues to deteriorate. Xi Jinping orders consumer goods to be replaced with new ones | China’s economic depression | Investment and consumption | Chinese Communist Party leader Xi Jinping

China’s economic decline has accelerated, with various economic indicators continuing to worsen, leading to a sluggish production, investment, and consumption. In response to this crisis, the leader of the Communist Party of China, Xi Jinping, has initiated a plan to promote internal circulation by promoting the replacement of old consumer goods with new ones.

The Central Financial and Economic Committee chaired by Xi Jinping recently discussed the need for a large-scale update of equipment and the replacement of old consumer goods. This initiative aims to encourage the trade-in of traditional consumer goods such as automobiles and home appliances, as well as promote the trade-in of durable consumer goods. The central finance and local governments are expected to coordinate and provide support throughout the entire chain of implementation.

Despite previous measures introduced by the authorities, China’s economic deflation has worsened. In January, the country’s consumer price index (CPI) fell by 0.8% year-on-year, marking the fourth consecutive month of deflation. The industrial producer price index (PPI) also continued to decline, raising concerns about entrenched deflation.

Moreover, during the recent Chinese New Year holiday, the per capita tourism spending in China decreased by 9.5% compared to pre-epidemic levels in 2019, highlighting the challenges faced by the government in reviving market confidence and boosting consumption.

To stimulate the economy, the Central Bank of China announced a 25 basis points cut in the loan interest rate for loans with maturities of more than 5 years, bringing the rate down to 3.95%. Despite this move, market observers remain skeptical about its effectiveness in reviving market sentiment.

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As China continues to grapple with economic challenges, experts warn of a looming period of great danger for the Chinese economy, emphasizing the need for effective strategies to reverse the ongoing recession.

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