Pro-growth policies set to stabilize economy

33 measures rolled out covering fiscal, financial, investment, consumption

China will accelerate the implementation of a raft of pro-growth policies to keep its economic performance within a reasonable range in the second quarter, the country's top economic regulator said on Thursday.

Meng Wei, a spokeswoman for the National Development and Reform Commission, said at a news conference in Beijing that China's economy is at a critical juncture that will define full-year economic performance trends for 2022.

Meng said the NDRC will fully implement a package of stimulus policy measures and ensure macro policies stay front-loaded to bring the economy back to the normal track.

In the next step, the NDRC will actively expand effective demand, ensure the safety and stability of food, energy, industrial and supply chains, promote the resumption of work and production as well as ensure supplies and stable prices for commodities essential to people's livelihoods.

The State Council recently unveiled 33 measures covering fiscal, financial, investment, consumption and industrial policies to further stabilize the economy amid pressure from resurgent domestic COVID-19 cases and changes in the international environment.

China's economic recovery gathered pace in May amid a gradual resumption of work and production, with headline data including industrial output improving from April and beating market expectations.

The National Bureau of Statistics said the country's value-added industrial output rose 0.7 percent year-on-year in May, compared with a 2.9 percent decline in April.

Experts said the latest numbers suggest good recovery momentum, and they expect to see the economy bounce back more visibly in the following months with stronger policy stimulus.

Yin Yue, a macroeconomic analyst at Shanghai-listed Hongta Securities, said growth momentum is projected to rebound in the following months as the impact of the COVID-19 pandemic gradually eases off, and some key indicators are likely to return to pre-pandemic levels.

Yin said investment in manufacturing and infrastructure will be essential for stabilizing growth this year.

The NDRC approved 121 billion yuan ($18 billion) of investment in 10 fixed-asset projects in May, Meng said during the news conference, adding that the investments were mainly in the transportation and water conservancy sectors.

She added that the NDRC will speed up the implementation of key projects, encourage the private sector's participation in major national projects, spur the consumption of big-ticket items and increase support for small and medium-sized enterprises.

More efforts will also be made to accelerate the push to promote the deep integration of 5G, artificial intelligence, big data and the real economy, build a number of important integrated computing infrastructure projects and nurture a better business climate.

Looking ahead, Meng said China is capable of meeting its approximately 3 percent consumer inflation target for 2022, and the growth of factory-gate inflation is likely to slow.

Wang Yuanhong, deputy director of the Department of Economic Forecasting at the State Information Center, said China is likely to keep prices within a reasonable range this year, leaving room for more policy adjustments to stabilize growth.

Wang said enterprises' rising costs due to high raw material prices represent a risk, and called for more efforts to ease burdens on midstream and downstream enterprises, especially small and medium-sized ones.