Expanding domestic demand, curbing monopolies to be China's major tasks in 2021
China is already on its way to boost consumer spending and counter monopolies, and it will continue to go further next year.
The two moves, suggested in this year's Central Economic Work Conference held from Wednesday to Friday in Beijing, will go along with six other ones as China's major economic tasks in 2021.
Chinese leaders usually discuss the country's economic performance of the year during the annual conference and chart the course for the economy for the following year.
As China and the rest of the world have been hit by the COVID-19 pandemic, the meeting this year was centered around China's recovery and its economic goals in its latest Five-Year Plan starting in 2021.
Expanding domestic demand
China's economic data shrank dramatically when the COVID-19 pandemic swept the country in early February. The total retail sales of consumer goods from January through February only reached 5.2 trillion yuan ($728 billion), a 20.5-percent dive compared to the same period last year, according to the National Bureau of Statistics.
While controlling the spread of the coronavirus, the country started to boost its consumption through promoting prepaid vouchers and cutting benchmark lending rates earlier this year, which together drove China's consumption, helping it recover from COVID-19.
The latest retail sales grew by five percent in November from a year earlier to 3.95 trillion yuan ($604.2 billion), maintaining a growing trend for four consecutive months.
Graphic by CGTN's Chen Yuyang
In the key economic meeting, Chinese leaders vow to insist on expanding domestic demand on the basis of promoting employment, improving social security, and expanding middle-income groups.
"Increasing wages is really the key," said David Blair, vice president of Center for China and Globalization, as the way to expand domestic demand. "If you have increased wages, people demand stuff."
Li Wei, senior China economist at Standard Chartered, told CGTN that consumer-related industries will be important to growth in 2021. He noted car sales, housing sales, and investments were the key drivers in 2020, but next year, he expects consumer spending and some of the service sectors to help boost the economy.
"We think there's going to be a recovery in service sectors, for example, accommodations, catering, international travels, and those sectors are likely to be key growth drivers for 2021," said Li.
Counter monopolies
Top Chinese officials again vowed during the meeting to strengthen anti-monopoly efforts and prevent the disorderly expansion of capital in 2021.
Anti-monopoly was brought to the table in early November when the planned $37 billion share market listing of e-commerce giant Alibaba affiliate Ant Group was suspended after regulators warned its lucrative online lending business needed tighter scrutiny.
Last month, China drafted anti-monopoly rules related to the country's online economy, including detailed information about disclosure requirements. The State Council then approved the establishment of an inter-ministerial committee, aiming to enhance efforts to combat unfair competition.
Several platform giants are facing greater oversights. On Monday, China's market regulator said it will fine Alibaba Group, Tencent-backed China Literature, and smart locker company Hive Box 500,000 yuan each for not reporting deals during anti-monopoly reviews.
