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Ji Siqi

Frank Chen

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This live blog has been made freely available as a public service to our readers. Please consider supporting SCMP’s journalism by subscribing. Get faster notifications on the latest updates by downloading our app.
China’s top economic planner, the National Development and Reform Commission (NDRC), held a press conference on Tuesday morning.
NDRC chairman Zheng Shanjie, as well as deputy heads Liu Sushe, Zhao Chenxin, Li Chunlin and Zheng Bei, unveiled a wide-ranging action plan.
Timed for the first workday after the weeklong “golden week” National Day holiday, the event followed the flurry of reforms unveiled at the end of last month.
More from our coverage:
– China’s commitment to economy not undermined by lack of large stimulus: analysts
– China sets upbeat tone after meetings despite lack of supercharged stimulus
– China’s space for fiscal stimulus could be limited amid debt woes: analysts
– How will unconventional tools unveiled by Beijing help support China’s stock markets?
– Foreign investors ‘seek shelter’ in undervalued Chinese assets, but scepticism remains
– How China’s 2024 stimulus compares with past packages, and what’s next
Additional reporting by Xinyi Wu, Ralph Jennings and Jiaxing Li


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China’s top economic planner, the National Development and Reform Commission (NDRC), held a press conference on Tuesday morning. Photo: EPA-EFE

National Development and Reform Commission chairman Zheng Shanjie. Photo: EPA-EFE

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China’s top economic planner, the National Development and Reform Commission (NDRC), held a press conference on Tuesday morning


China’s top economic planner, the National Development and Reform Commission (NDRC), held a press conference on Tuesday morning.


China economy

China’s economic stimulus

Live

China’s top economic planner, the National Development and Reform Commission (NDRC), will hold a press conference on Tuesday morning.



Welcome

National Development and Reform Commission (NDRC) chairman Zheng Shanjie, as well as deputy heads Liu Sushe, Zhao Chenxin, Li Chunlin and Zheng Bei, are set to attend the press conference.



Who will attend?

The officials are set to unveil a wide-ranging action plan.
Timed for the first workday after the weeklong “golden week” National Day holiday, the event follows the flurry of reforms unveiled at the end of last month.
Consumption-boosting initiatives, as well as plans to expedite green transition and the adoption of green energy, are expected to be included.
“China needs a big announcement to move out of what is like a cul de sac, or an impasse,” said Alicia Garcia-Herrero, chief economist for Asia-Pacific at French investment bank Natixis in Hong Kong.
“China was doing this already, but with less conviction. It has taken [a long time] for Beijing to get its act together. Now the market is expecting much more.”
On September 28, China’s top economic planner had already reassured private entrepreneurs it would “spare no effort” to help companies “conquer difficulties”.
National Development and Reform Commission head Zheng Shanjie hosted a meeting with representatives from several private companies to learn about business conditions, problems they were facing and their views and suggestions on the economy.
“Private entrepreneurs are people of our own,” Zheng said. “We’ll spare no effort to help your companies conquer the difficulties.”



What can we expect?

Chinese stocks soared as the market opened on Tuesday after a week-long holiday to catch up with the frenzy in Hong Kong, the world’s best-performing market this year.
The CSI 300 Index, which tracks the biggest mainland companies listed in Shanghai and Shenzhen, opened 10.8 per cent higher, the biggest jump on record.
The Shanghai Composite Index rallied 10.1 per cent, while the Shenzhen Composite Index surged 12.9 per cent before the press conference got underway.


Market performance on Tuesday morning

On September 24, China announced a suite of new heavyweight policies to boost the economy.
They included included cuts to the mortgage rate for existing housing and the reserve requirement ratio. China’s central bank also said it planned to roll-out new tools to support the stock market.
On September 26, President Xi Jinping issued a rallying call in an unexpected Politburo meeting to help the private sector and mobilise officials across the nation to prioritise reviving the economy.
A vow to help tide over enterprises facing hardships, and a reassurance to officials that they can go bold in boosting the economy without worrying about the consequences of making mistakes, were among the highlights of the top decision-making meeting.
Also on September 26, seven government departments issued a joint notice with a list of steps to stabilise China’s 500 billion yuan (US$71 billion) dairy industry.




What measures have already been announced?

Before the National Day holiday, major stock indices had soared in China as retail traders and money managers rushed to build bullish positions, sending daily transactions to record levels.
The Shanghai Composite Index benefited the most, coming out of September with the most monthly gains recorded since April 2015.
Combined turnover on the Shanghai and Shenzhen bourses rose to an all-time high of 2.6 trillion yuan (US$367.55 billion) on the last trading day of September.
Trading resumed on Tuesday after the week-long holiday.




How had the markets reacted?

Beijing is also expected to roll out more measures to boost Hong Kong and Macau’s economic development, about a week before Chief Executive John Lee Ka-chiu is set to deliver his third annual policy address.
The pledge was disclosed in a commentary published by the Hong Kong and Macau Affairs Office on Sunday, ahead of Tuesday’s much-awaited press conference.
Beijing’s top office overseeing Hong Kong wrote in the commentary that central authorities had been rolling out measures according to the needs of the two cities.
It cited as examples the five-year travel permits for permanent residents with foreign passports in Hong Kong and Macau, the raising of duty-free shopping allowances for mainland Chinese tourists visiting the two cities, and the gifting of two pandas to Hong Kong.
“National development is the biggest support for the development of Hong Kong and Macau after all, the motherland has been providing the two cities precious opportunities, continuous momentum and huge space [for development],” the office said.
“In the future, more policies and measures benefiting Hong Kong and Macau will continue to be introduced.”



Fresh measures to boost Hong Kong?

National Development and Reform Commission (NDRC) chairman Zheng Shanjie, as well as deputy heads Liu Sushe, Zhao Chenxin, Li Chunlin and Zheng Bei, are on the stage.



Officials arrive

According to Xinhua, multiple users from different brokerage firms have reported that the banks securities transfer function is slow and unresponsive, making it impossible to transfer money in or out.


Brokerage firms report banks securities transfer function is slow, unresponsive

National Development and Reform Commission (NDRC) chairman Zheng Shanjie opens up by saying that making sense of the current economic situation requires China to be comprehensive, objective and calm in assessing it.



NDRC chair calls for level-headed approach

Zheng Shanjie continues to talk about the great work China has done.



China has done ‘great work’

The combined transaction volume in the Shanghai and Shenzhen stock markets exceeded 1 trillion yuan (US$141 billion) within 20 minutes of market opening, according to Cailian.


Stock market update

Zheng Shanjie says external risks are on the rise, economic downward pressure is increasing, and some firms have been unable to adapt to “involuted” competition.
Nonetheless, China’s economic fundamentals have not changed, he says. There is still great market potential, and leadership has confidence that their full-year economic growth target will be achieved.


Risks rising, but economic growth target attainable

Zheng Shanjie says new measures will focus on expanding domestic demand, increasing support and the property and capital markets.



New measures

Zheng Shanjie says China should adhere to the systematic implementation of policies to coordinate finance, finance, consumption, investment, real estate, stock market, employment and people’s well-being.
“We should focus on the policy of increasing domestic demand, focusing more on benefiting people’s livelihood and promoting consumption,” he says.


Focus more on livelihoods, boost consumption

Zheng Shanjie has yet to announce any specific measures.


No specific measures

Zheng Shanjie says China should increase countercyclical macro policies, ensure necessary fiscal expenditures, speed up the expenditure process, and resolve debt risks.
He adds that the moving forward of reform measures should be implemented, such as a shoring up a national market to attract foreign direct investment.


Resolve debt risks, open more to foreign investment

Zheng Shanjie emphasises need to increase consumption and investment, especially among low- and middle-class groups.
He notes that before the National Day holiday, one-time subsidies were handed out to orphans, and help is being given to low-income students via cheaper loans.
He also notes the importance of enhancing elderly care and child care services.
However, no specific new measures have yet been announced.



Help for those in need, such as children, elderly residents and students

Stock market indices opened higher but soon retreated, with the Shanghai index’s gain narrowing to 5 per cent after previously rising by more than 10 per cent.
On Shenzhen’s ChiNext – a NASDAQ-style subsidiary of the Shenzhen Stock Exchange – gains narrowed to 13 per cent, having earlier risen more than 18 per cent.


Zheng Shanjie says China will front-load 100 billion yuan (US$14.1 billion) from the 2025 central budget and also release a list of strategic construction projects.


China to front-load 100 billion yuan from 2025 central budget

Zheng Shanjie says China will support the financing of small and medium-sized enterprises.
Additional support will also go to the property market, with one aim being to digest the existing stock of housing.
Special bonds and other support will help revitalise the stock of idle land. The policy of restricting housing purchases will be adjusted, demand for basic and improved housing will be released, and the digestion of commercial housing stock will be sped up.



Support for SMEs, property market

Zheng Shanjie says China will use special bonds and other support to revitalise the stock of idle land.
He says it will also adjust the policy of restricting housing purchase, release the demand for basic and improved housing, and speed up the digestion of the stock of commercial housing.


China to speed up use of special bonds, revitalise stock of idle land

In response to a question on weak confidence in the private sector and among foreign firms, Zheng Bei says China’s legal framework will be improved and equal treatment will be given to private firms and state-owned enterprises.
Meanwhile, law enforcement will be standardised to reduce interference in normal business operations.
Help will also be given to private firms to solve their problems, while their suggestions will be heard, including calls for financing assistance.



How will China waning business confidence be addressed?

The Hang Seng Index had plunged by as much as 10 per cent in the morning trading session, but it has now narrowed to a fall of 7.7 per cent.
The Hang Seng Tech Index plunged as much as 14.4 per cent in earlier trading session, and is now falling 9 per cent.



NDRC deputy head Zhao Chenxin says the economy was “stable” across the first three quarters of the year, “according to data we’ve seen”.
He adds that the conditions, capability and confidence are in place to achieve leadership’s “around 5 per cent” economic growth target for this year.


Quarterly data points ‘stable’, economic growth target seen attainable

Li Chunlin takes a question from Bloomberg on employment.
Li says it is a very normal phenomenon that talent flows to industries with a labour productivity rate and that new industries create new jobs.
Li adds that there are structural issues in employment, but there are new job openings emerging in new industries like electric vehicle repairs and drone operators.



Jobs update

Liu Sushe takes a question on urban renewal infrastructure.
Liu says that underground pipes projects need more funding and will be made a priority.
Liu says China will attract private funds for urban renewal using public private partnerships and real estate investment trusts.


Urban renewal infrastructure

On specialised local government bonds, deputy NDRC head Liu Sushe says they are working with the Ministry of Finance on a new way to manage them.
This year, 3.12 trillion yuan (US$441 billion) in special debt has been allocated for project construction. By the end of September, 2.83 trillion yuan had been issued, meaning there is still about 290 billion yuan remaining.
In this respect, all localities are urged to issue their requests by the end of this month.



Special bonds for economy-boosting infrastructure projects

Zhao Chenxin says China will tap the potential of existing energy saving initiatives, while also ensuring a transformation in traditional industries and upgrading the development of emerging industries.


China to tap potential of existing energy saving initiatives

Deputy NDRC head Zheng Bei, speaking about urbanisation and China’s migrant workforce, says help is being given to more than 170 million migrant workers and their families across the country, in light of how difficult it can be for them to uproot their lives and settle down in big cities.



Help for China’s 170 million migrant workers

Liu Sushe takes a question from Post reporter Ji Siqi.
Liu says China will pick the right projects to suit the direction of economic development.
China will conduct thorough preliminary work and carry out in-depth study before construction, Liu adds.
Liu says China will ensure the sources of funds, for some qualified projects, can increase financial support from local governments to relieve the pressure on local authorities.



China will pick the right projects to suit the direction of economic development

And that’s all folks

“They created expectations of a much bigger stimulus, so everybody was disappointed,” says Alicia Garcia-Herrero, chief economist for the Asia-Pacific region at French investment bank Natixis in Hong Kong, as the press conference wraps up.
“Even worse, they talked about frontloading from 2025, so no new money. Basically, they have created a bubble, but they are not ready to feed it further with fiscal stimulus, and bubbles need that.
“Words are not enough.”


‘Words are not enough,’ analyst says

Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered Bank in Hong Kong, draws a correlation between the Hong Kong stock market drop and the NDRC event.
“It looks very much related,” he said. “The only driver [for stocks] is today’s NDRC event. Market expectations were high ... The stock market, especially, had high expectations. But this is the NDRC, not the Ministry of Finance. Even though they didn’t announce fiscal stimulus today, that doesn’t mean there won’t be fiscal stimulus.”
Ding expects fiscal stimulus measures to be announced by month’s end.
