MNI BRIEF: China Should Improve Consumption Subsidy

China must enhance the targeting of consumer subsidies, strengthen support for exporters, and step up efforts to stabilise the property market in the second half of the year, according to a report by the China Macroeconomy Forum.

Authorities should introduce more targeted subsidies for students with high consumption willingness as well as urban retirees with strong spending power, and expand subsidies to the service sector, the report said, noting that the CNY330 billion consumer goods trade-in scheme is expected to drive 1.5-2% of retail sales growth this year.

A set of systematic solutions to export order fulfillment should be introduced in preparation for fluctuations in U.S. tariff polices, while helping exporters to redirect their products to the domestic market or overseas expansion. (See MNI: China Advisors Hopeful Of US Trade Deal By Mid-August)

The report said stabilising the housing market should take on greater importance in the second half of the year as export pressures mount, urging authorities to allow fster completion of market clearance and ensure banks properly manage real-estate credit. (See MNI: China Likely To Lower Homebuying Down-payment Ratios)