China plant expansion of domestic demand to stimulate economic growth

(Patria) - China has set plans to expand domestic consumption and investment, the official Xinhua news agency announced on Wednesday, as the economy struggles with COVID and
weakening external demand.

China faces multiple challenges as the rapid easing of strict COVID-19 restrictions leads to a wave of infections, affecting businesses and consumers, while the weakening global economy harms Chinese exports, Reuters assesses. Strengthening domestic demand will help China achieve higher quality economic growth and cope with external risks and challenges, Xinhua states, citing government plans for the period 2022-2035.

„We must firmly implement the strategy of stimulating domestic demand, expand resident consumption and effective investment, increase the resilience of economic development, and promote sustainable and healthy economic development,“ writes Xinhua.

This move to strengthen domestic demand will support the country's „dual circulation“ strategy, Xinhua states.

China introduced the „dual circulation“ strategy for the next phase of economic development, which will rely mainly on „domestic circulation“ - the internal cycle of production, distribution, and consumption, supported by innovation and upgrades in the economy, Reuters concludes.