In the first half of 2022, due to the recurrence of epidemics in many important cities, the turmoil in the international economic and financial situation caused by the Ukrainian crisis and Federal Reserve consecutive interest rate hikes further added pressure to the country's economic recovery. In the context of rising debt risks, can fiscal policy maintain sustained increases in spending? What challenges will we face if we use fiscal resources to stimulate the economy?
Economic development is facing triple pressures of shrinking demand, supply shocks, and weakening expectations.
In response to the downward pressure on the economy, macroeconomic policies were implemented in the first half of the year and achieved certain results. The epidemic situation recurred in many important cities, resulting in a reduction in economic activities or even a standstill, and the impact was far greater than expected. Repeated epidemics are the main factor causing the weak domestic economic performance this year.
html In May, with the overall improvement of the domestic epidemic prevention and control situation, both the central and local governments seized the time window and decisively introduced a package of policies to push the economy back to normal track. According to incomplete statistics, after the State Council issued the " Package of Policies and Measures to Solidly Stabilize the Economy ", more than 20 provinces, autonomous regions and municipalities across the country introduced local packages of measures or plans to stabilize the economy.
Grasping projects, expanding investment, and expanding domestic demand have become the focus.
htmlSince 16 months, data show that some economic indicators have improved significantly. In terms of production, daily power consumption this year has exceeded that of the same period last year, and the national comprehensive vehicle freight traffic has basically returned to the level of mid-to-late March. In terms of consumption, commercial housing and automobile sales both picked up.
It is increasingly becoming a consensus that China’s economy will accelerate its recovery in the second half of the year. The latest "China Economic Brief" released by the World Bank shows that China's economic growth momentum is expected to rebound in the second half of the year, driven by a series of stabilizing economic policies such as strong fiscal and monetary policies.
As the economy bottoms out, the rebound in economic growth has attracted market attention.
The aforementioned economic growth forecast results have consistently fallen below the "around 5.5%" growth target set in the government work report. This shows that the market is still cautious about the speed of economic recovery, because of the fundamental way of economic development. It is about stimulating and reshaping the confidence and vitality of market entities, which also means that achieving the growth target requires policy reinforcement.
The endogenous characteristics of my country’s economic resilience and great potential have not changed. In the short term, the domestic epidemic has eased and economic development will get back on track. If there is no large-scale epidemic impact in the second half of the year, the pace of economic recovery will accelerate. Recommendations should be issued based on the situation and in accordance with the principles of refocusing, intensifying efforts, and benefiting the long term. incremental policy.
The current money market liquidity is abundant, and the decline in financing demand is the key to the problem.
In the next step, the government will support financial institutions in developing consumer credit businesses through interest discounts. Promote consumption through appropriate government subsidies and appropriate concessions by financial institutions to issue low-interest and interest-free consumer credit. The proactive fiscal policy should continue to increase efforts to maximize the domestic demand strategy, promote the continued recovery of consumption, and enhance the endogenous power of development.
The troika that drives economic development, consumption, exports, and investment all need to find new development models .
On the one hand, there is abundant liquidity in the capital market and it is very easy to harvest. On the other hand, by helping my younger brother apply for college this year, I deeply feel that I feel that the cheap labor force in the past may no longer exist.
To truly integrate money into the real economy, perhaps digital economy will be a breakthrough point without polluting the environment. As human material needs are increasingly met, happiness can only develop in this direction, otherwise social development will stop. The source of new happiness is to create economic growth momentum, which requires people to innovate!
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