As global trade dynamics shift, China is doubling down on expansionary fiscal measures to fuel its economy – think ‘government spending as a supercharger’ ⚡. Senior researcher Fei Zhaoqi from the Chinese Academy of Social Sciences breaks down why this strategy matters for the world’s second-largest economy.
The Export Squeeze & Domestic Pivot 🌏➡️🇨🇳
With exports facing long-term decline due to ‘de-globalization’, China’s playing a new game: boosting domestic demand. Picture factories swapping cheap gadgets for tech innovation 🖥️ and services targeting homegrown needs like food security and clean energy. Translation? More jobs, local R&D, and self-reliance.
Why Fiscal Firepower Matters 🔥
When households and businesses tighten their wallets, the government’s stepping in as ‘the spender of last resort’. By issuing bonds and running deficits, Beijing aims to kickstart growth where traditional monetary policy struggles. Zhaoqi calls this a ‘lifeline’ for sectors like manufacturing and green tech.
Where the Cash Is Flowing 💸
From consumer subsidies (hello, new appliances! 🛋️) to securing supply chains against global shocks, the focus is twofold:
Tech innovation: Government-backed R&D in key sectors
Safety nets: Ensuring stable food and energy supplies amid market turbulence
Zhaoqi notes: ‘This isn’t just about today’s growth – it’s building China’s economic immune system.’ 🛡️
