Sinobravo Policy Express (November, 2024)

2024-12-30

Editor’s Note: In October, as the government accelerated the implementation of existing policies and introduced new growth policies, the combined effects of these policies have significantly boosted the economy. The national economy is steadily improving, with the service sector accelerating significantly. The production index increased by 6.3% year-on-year; industrial production showed stable growth, with a 5.3% year-on-year increase in value-added output; retail sales of consumer goods rose by 4.8% year-on-year; fixed asset investment grew steadily, up 3.4% year-on-year; investment in high-tech industries increased by 9.3%; goods imports and exports grew by 4.6% year-on-year, with trade structure continuing to improve; the urban surveyed unemployment rate was 5.1%; consumer prices increased slightly, while the year-on-year decline in industrial producer prices narrowed. Overall, while the foundation for economic recovery needs further consolidation, the general trend is positive. At the same time, external uncertainties remain, and domestic demand is still insufficient. However, with sustained policy support and market adjustments, the foundation for economic recovery is expected to strengthen further.

Economic Operation

On November 15, the National Bureau of Statistics released data on China's economic performance in October. The national economy continued to grow steadily, with major economic indicators showing significant improvement:

Stable Industrial Growth: In October, the industrial added value of large-scale enterprises nationwide increased by 5.3% year-on-year and 0.41% month-on-month. The equipment manufacturing and high-tech manufacturing industries experienced faster growth.

Rapid Growth in Services: The service sector production index increased by 6.3% year-on-year in October.

Quick Recovery in Market Sales: In October, the retail sales of consumer goods grew by 4.8% year-on-year.

Stable Fixed Asset Investment Growth, Fast Growth in High-tech Industry Investment: From January to October, fixed asset investment nationwide totaled 42.3222 trillion yuan, growing 3.4% year-on-year. Investment in high-tech industries increased by 9.3%, and private investment grew by 6.3%.

Rapid Growth in Imports and Exports, Continued Optimizing of Trade Structure: In October, the total value of imports and exports was 3.7007 trillion yuan, growing 4.6% year-on-year. Exports were 2.1899 trillion yuan, up 11.2%, while imports were 1.5108 trillion yuan, down 3.7%.

Slight Rise in Consumer Prices: In October, the consumer price index (CPI) rose by 0.3% year-on-year. The industrial producer price index dropped by 2.7% year-on-year and 0.3% month-on-month.

Stable Employment Situation: From January to October, the national urban surveyed unemployment rate averaged 5.1%. In October, it was 5.0%, down 0.1 percentage point from the previous month.

Policy Environment

High-Level Interactions

On November 26, President Xi Jinping met with Singapore’s Senior Minister of State, Teo Chee Hean. Xi noted that this year marks the 30th anniversary of the Suzhou Industrial Park's development, which has transformed from a “pond and lowland” into an “innovative city,” becoming a vivid model of cooperation between China and Singapore. He welcomed Singapore to continue to lead cooperation with China, make good use of the bilateral cooperation mechanism, and manage major projects at a high level.
On November 19, President Xi met with French President Emmanuel Macron. Xi emphasized that China is willing to deepen cooperation with France in cultural, educational, regional, and youth exchanges to enhance mutual understanding between the two peoples.
On November 19, President Xi met with German Chancellor Olaf Scholz. Xi stressed the importance of enhancing cooperation in digitalization, intelligence, and decarbonization, and exploring third-party markets for mutual benefit.
On November 18, President Xi met with Mexican President Andrés Manuel López Obrador. Xi highlighted the need for increased exchanges and to deepen practical cooperation, leveraging the high complementarity of the two countries' economies.
On November 16, President Xi met with U.S. President Joe Biden. Both sides reached seven consensus points on the guiding principles of China-U.S. relations, agreeing to maintain these principles to stabilize the relationship and achieve a smooth transition.
On November 15, President Xi met with Japanese Prime Minister Fumio Kishida. Xi emphasized that China and Japan's deep economic and industrial integration should focus on cooperation and maintaining a stable global free trade system.
On November 25, Premier Li Qiang held a meeting with representatives from the second China International Supply Chain Promotion Expo. Li expressed hope that enterprises would continue to support global supply chains, innovate in cooperation, and focus on green transformation.
On November 7, Premier Li Qiang attended the 8th Greater Mekong Subregion (GMS) Economic Cooperation Leaders’ Meeting in Kunming. Li noted that China and the Mekong countries are a closely-knit community of destiny and should enhance collaboration, leveraging their economic complementarity.
On November 20, Vice Premier Ding Xuexiang attended the opening ceremony of the 2024 World Internet Conference in Wuzhen, Zhejiang, delivering a keynote speech. Ding highlighted China’s major progress in developing a digital economy and the steps taken to strengthen internet development.
On November 16, Minister of Commerce Wang Wentao met with Canadian International Trade Minister Mary Ng. Wang pointed out challenges brought by discriminatory measures taken by Canada against Chinese products and their stricter scrutiny of Chinese enterprises.
On November 14, Minister Wang Wentao met with Japanese Minister of Economy, Trade, and Industry Yasutoshi Nishimura in Lima, Peru, to discuss bilateral trade issues, export control mechanisms, and China’s accession to the CPTPP.
On November 3, Minister Wang Wentao met with the French Ministry of Foreign Affairs’ representative to discuss China-France trade relations and EU-China trade friction.

China’s Foreign Direct Investment (FDI)

From January to October 2024, China’s non-financial direct investment abroad reached $115.83 billion, increasing by 10.6% year-on-year. Of this, investments in Belt and Road countries totaled $26.65 billion, up 3.0%.
China has released new regulations on the export control list for dual-use items and measures to support the deepening of open innovation experiments in Suzhou Industrial Park.

Foreign Trade and Investment Policies

The Ministry of Commerce released new policies to enhance financing support for foreign trade enterprises and improve the cross-border e-commerce ecosystem. Measures include promoting stable export growth and expanding international trade, with particular focus on high-level international cooperation.
The General Administration of Customs published a draft announcement aimed at promoting the development of cross-border e-commerce and simplifying the process for e-commerce companies involved in overseas warehousing.

Tax Policies

The Ministry of Finance issued new policies to regulate financial handling under the new Company Law and Foreign Investment Law, improving the management of foreign investments and risk prevention.
The State Taxation Administration launched initiatives to digitize electronic invoices and enhance data security for business transactions. It also addressed the adjustment of land value-added tax prepayment rates.

Please click on the link below to read more about industry trends: 中富博睿政策速递（2024年11月刊）

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