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Xinhua Headlines: What to expect as China's local authorities plan for 2025 economy

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E-mail Xinhua, January 21, 2025

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BEIJING, Jan. 21 (Xinhua) -- Since the beginning of the year, China's provincial-level regions have been holding their "two sessions" meetings, where government work reports were delivered to outline the development priorities for 2025.

Boosting consumption and developing "new quality productive forces" have continued to be the common goals. The inclusion of new terms such as "debut economy" has also shed light on the pursuit of new growth engines by local governments.

Against the backdrop of the global economic slowdown, initiatives by China's local governments to boost their economy this year have garnered significant attention from around the world.

DEBUT ECONOMY

China's Central Economic Work Conference in December 2024, which heralded the general direction of its economic work for the coming year, said active efforts should be made develop debut economy, ice-and-snow economy and silver economy.

Debut economy is a relatively new concept. It is a catchall to describe companies launching new products, introducing new business models, services and technologies, and opening flagship stores.

The term has been incorporated into the 2025 government work reports of Shanghai, Guangdong, Hunan and Heilongjiang, among others.

Shanghai, as a hub for domestic and international brands to launch new products and flagship stores, said it will vigorously develop the debut economy in 2025. The metropolis saw the opening of 1,173 "first stores" in the first 11 months of 2024.

The province of Guangdong also said it plans to introduce more "first stores" and host more produce launches in 2025 amid the drive to build cities like Guangzhou and Shenzhen into consumption hubs.

Its provincial capital Guangzhou has designated 30 landmark buildings and districts as operational spaces for the debut economy. In early 2024, the city introduced a slew of measures, including cash rewards and a streamlined approval process, to attract the launches of new products and brands' "first stores".

Experts have highlighted the debut economy's contribution to stimulating the consumption market and encouraging industrial innovation.

"The debut economy is of great importance to leading consumption trends and releasing consumption potential. It can also enhance the image and competitiveness of a city," said Xiong Yanni, a provincial political advisor of Hunan and vice chair of the federation of industry and commerce of the city of Loudi.

CONSUMER CONFIDENCE

Many local government work reports have highlighted the task of boosting consumption in 2025, following the Central Economic Work Conference's pledge to "vigorously boost consumption, improve investment efficiency, and expand domestic demand on all fronts."

Consumption has continued to prop up China's economic recovery, with final consumption expenditure contributing 2.2 percentage points to the country's economic growth of 5 percent last year.

Megacities such as Beijing and Shanghai have outlined plans to advance the construction of international consumption center cities, while promoting emerging sectors such as the silver economy, live-streaming and sports events.

Northeastern provinces like Jilin and Heilongjiang have prioritized the ice-and-snow economy. Heilongjiang aims to drive the development of a comprehensive industrial chain that includes ice-and-snow sports, culture, equipment manufacturing and tourism, with the goal of establishing a world-class ice-and-snow tourism resort and economic hub.

Provinces such as Guangdong, Hunan, Hebei and Zhejiang have also highlighted trade-in programs for consumer goods such as home appliances and automobiles.

In its government work report, manufacturing heartland Guangdong has pledged to continuously optimize its consumer goods trade-in program, covering mobile phones, tablets, smart watches and smart wristbands. Efforts will also focus on stabilizing and expanding consumption in key sectors such as automobiles, home appliances and furniture.

To stimulate consumer spending and drive economic growth, China announced an action plan in March 2024 to implement large-scale equipment upgrades and consumer goods trade-ins -- nearly 15 years after the last such renewal campaign.

Official data reveals that the trade-in scheme boosted sales of automobiles, home appliances and other items by over 1.3 trillion yuan (about 181.3 billion U.S. dollars) in 2024.

"The lack of sufficient effective consumption is not only a challenge to global economic recovery but also a critical factor limiting China's economic growth," said Yin Xiangdong, secretary general of the China Consumer Economics Society.

Yin believes that, with the implementation of various consumption-boosting policies, the impact of these efforts will be even more pronounced in 2025, making consumption more vibrant.

NEW QUALITY PRODUCTIVE FORCES

New quality productive forces, industrial upgrades and technological innovation have continued to figure prominently in local economic roadmaps for the second consecutive year. And some pacesetters are going one step farther, setting their sights on more futuristic goals.

Beijing, for example, unveiled plans for a humanoid robot half-marathon during its municipal "two sessions", set to become the world's first event of its kind.

Beijing's government work report also highlights the Chinese capital's commitment to becoming a global leader in innovation, with a focus on 20 emerging sectors, including humanoid robotics, bio-manufacturing and new materials.

China's major coal-producing province of Shanxi has pledged to strengthen fundamental research and tackle key technological problems, announcing the implementation of 150 key research and development (R&D) initiatives. It also aims to increase R&D investment in major industrial enterprises by 13 percent in 2025.

Many regions have made R&D funding a key indicator, which encourages enterprises to develop new technologies, equipment and products, said Zhao Gang, an industrial analyst at Beijing-based consultancy firm CIO Manage.

"Developing new quality productive forces is the key focus for regional and industrial development at present," said Dong Yu, executive vice president of the China Institute for Development Planning at Tsinghua University.

Dong noted that by cultivating new quality productive forces, China can enhance the competitiveness of its entire industrial system, further solidifying the foundation for economic stability and accumulating momentum for future progress. Enditem