Xinhua reported on Monday, May 23, that Premier Li Keqiang presided over a recent State Council Executive Meeting. It was decided at the meeting that the central government would implement a package of economic measures to stabilise the faltering Chinese economy.
This meeting and/or the reporting of this meeting strikes me as unusual. State Council Executive Meetings are usually held on Wednesdays (or occasionally Thursdays), and they are almost always reported on the same day. In this case, we don't know when this meeting was held; the Xinhua readout only stated that it was held "day(s) ago".
If it was held as per the usual schedule (that would be Wednesday, May 18), why was it not reported on the same day? If it wasn't held per schedule, why?
I don't know the answer, and can only speculate. We could speculate about elite politics, but the most likely reason is that the State Council leadership met and decided on these economic measures earlier but did not want to announce them until now. Or the reason could be more prosaic.
Economic stabilisation measures
China's economy is encountering severe headwinds, including the economic dislocation from Beijing's Zero-COVID policy, bruised investor and consumer confidence, and geopolitical complications.
At the meeting, the State Council leadership decided on 33 economic measures across six areas to stabilise the economy. These include:
- extending value-added tax credit refunds to more industries;
- prolonging the policy of deferred pension premium payments for hard-hit sectors and certain categories of enterprises;
- doubling the scale of the support facility for loans to micro and small businesses;
- encouraging the listing of platform companies on domestic and overseas markets;
- making an additional emergency loan of 150 billion yuan available to the civil aviation industry;
- increasing the number of domestic and international flights;
- relaxing the restrictions on vehicle purchasing;
- launching a new round of rural road construction and renovation work; and
- building a batch of hydropower and coal-fired power plants this year.
These measures might help the economy, but the real elephant in the room is Beijing's Zero-COVID policy, which has caused major disruption to economic and social life in China. Without loosening the stringent COVID measures, China's economic prospects in the near term remain clouded.
By Adam Ni