China vice premier pledges more policy support, says economy started 2025 well

BOAO: Chinese Vice Premier Ding Xuexiang on Thursday pledged stronger policy support for the world’s No.2 economy, which he said had started 2025 well and was on track to hit this year’s growth target, buoyed by advancements in AI and other technologies.

His keynote speech at a business and political summit in the island province of Hainan comes in a week where Beijing has mounted a charm offensive to woo fresh foreign investment for its sluggish economy and protect against simmering geopolitical tensions.

Chinese policymakers have put expanding domestic demand top of the agenda this year as they try to cushion the impact of US President Donald Trump’s tariff salvos, but have struggled to assuage foreign investors’ concerns over the durability of the post-pandemic recovery underway in the $18 trillion economy.

“In the first two months of this year, the economy started off steadily, continuing the recovery momentum seen since the fourth quarter of last year, China’s sixth-ranking official told delegates at the annual Boao Forum.

“This year’s growth target of around 5% is determined through careful calculations and meticulous planning, and is supported by both growth potential and favourable conditions, along with strong policy measures,” Ding said

“More proactive and effective macroeconomic policies will be implemented to comprehensively expand domestic demand and stabilise foreign trade and investment,” he added.

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Foreign investors have soured on China in the years since the COVID pandemic, with business’ longstanding concerns about geopolitics, tightening regulations and a more favourable playing field for state-owned companies weighing heavier.

Foreign direct investment into China dropped an annual 13.4% or $13.5 billion in January, according to the most recent data from China’s commerce ministry.

“We will steadily expand institutional opening up, further ease market access for foreign investment… and sincerely welcome enterprises from all countries to invest and develop in China,” Ding said.

Policymakers would also make “greater efforts” to “promote the healthy development of the real estate and stock markets,” he added, which will be crucial to encouraging Chinese consumers into spending again, analysts say, given that 70% of household wealth is held in real estate.

Ding also talked up China’s increasing competitiveness in new energy vehicles, where Western accusations that Chinese firms benefit from unfair state subsidies have seen its producers hit with tariffs, as well as in artificial intelligence, bio-manufacturing and quantum technologies.

“China’s economy is advancing towards new frontiers, accelerating high-level technological self-reliance and self-strengthening,” Ding told delegates, which included Chinese smartphone and NEV maker Xiaomi’s CEO Lei Jun.

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But amid the talk of self-strengthening, Ding reiterated Chinese Premier Li Qiang’s message at the China Development Forum in Beijing on Sunday that countries should open their markets and “resolutely oppose trade and investment protectionism,” in a veiled reference to the Trump administration.

US President Donald Trump has announced a wave of fresh “reciprocal” tariffs to take effect on April 2, targeting countries with trade barriers on US products, which could include China.

He imposed 20% tariffs on Chinese exports this month, prompting China to retaliate with additional duties on American agricultural products.