China’s leaders vow to fight ‘risks’ plaguing economy as third plenum ends, but no concrete steps outlined

BEIJING: China’s leadership vowed on Thursday (Jul 18) to “resolve risks” plaguing the economy, state media said, but were yet to offer any concrete steps to pull the country out of its financial woes.

The world’s second-largest economy is grappling with a property debt crisis, weakening consumption, and an ageing population.

All eyes were on how this week’s Communist Party conference in Beijing, attended by President Xi Jinping, might tackle the country’s deepening economic malaise.

But few new policies were announced as the meeting wrapped up on Thursday, with state news agency Xinhua saying they had instead “adopted a resolution on further deepening reform”.

Gary Ng, a senior economist at Natixis, said the readout offered “nothing out of expectation as it just confirms existing policies.”

But officials did agree to “actively expand domestic demand”, state media reported, after data this week showed retail sales – a key gauge of consumption – rose just 2 per cent in June.

They further agreed to “prevent and resolve risks in key areas such as real estate, (and) local government debt”, Xinhua said.

The Third Plenum has previously been an occasion for the party’s top leadership to unveil major economic policy shifts.

In 1978, then-leader Deng Xiaoping used the meeting to announce market reforms that would put China on the path to dazzling economic growth by opening it to the world.

And more recently following the closed-door meeting in 2013, the leadership pledged to give the free market a “decisive” role in resource allocation, as well as other sweeping changes to economic and social policy.

Echoing past plena, top officials promised on Thursday to “give fuller play to the role of market mechanisms”.

But they also said they would “make up for market failures” and “smooth the circulation of the national economy”.