China’s State Council issued a package of measures to stabilize the economy in late May, hoping to pull enterprises out of the sluggish economy largely caused by the Covid-19 pandemic and resulting sweeping lockdowns.
The measures cover six areas with 33 specific items, including financial support, stabilizing industrial and supply chains, promoting consumption and investment, ensuring energy and food safety and improving livelihoods.
The government pledged an extra 140 billion yuan (US$21.5b) in tax refunds and offers tax and fee cuts to small- and medium-sized enterprises (SMEs), as well as allowing businesses in sectors that have been particularly hard hit to postpone employees’ social insurance payments. Besides continuing to encourage and facilitate loans to SMEs, interest payment delays are allowed.
To facilitate production resumption, the government ordered a halt to unreasonable restrictions on cargo trucks and their drivers and said it will support airline companies to increase international and domestic flights.
Stimulating investment and consumption is a big focus. Besides simplifying approvals for new irrigation and traffic facilities and activating a new round of construction of rural roads, restrictions on car and apartment purchases are also expected to loosen based on economic and social conditions in different regions.
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