Xi Jinping Promotes a More Dynamic Economy by 2025
The President of China, Xi Jinping, urged on Tuesday for the implementation of a more "dynamic" macroeconomic policy by 2025, according to reports from state media, as the government seeks to mitigate the slowdown in the world's second-largest economy. "It is necessary to create macroeconomic policies that are more active and effective," emphasized the leader during a year-end event of the National Committee of the Chinese People's Political Consultative Conference, according to the state broadcaster CCTV.
The Chinese economy is facing a phase of deflation, driven by a severe crisis in the real estate sector and consumer spending that remains below pre-pandemic levels. In recent months, Beijing has implemented several fiscal stimulus measures, highlighting interest rate cuts and increasing the debt ceiling for local governments. However, some experts warn that more direct actions will be needed to sustain economic growth. During his New Year speech, Xi Jinping mentioned that the economy is under "pressure" to "transform" and shift from "old growth methods to new ones," in addition to facing an "uncertain external environment." The Chinese leader expressed optimism about reaching the official GDP growth target, which is estimated at 5% for 2024, although analysts are skeptical about whether the Asian giant can achieve this goal. Official growth figures will be released in January. Xi made these statements following the news that the monthly manufacturing activity index has grown for three consecutive months. Export orders reached their highest level in the last four months, which "is likely due to a surge in orders from American importers anticipating potential tariffs under the Trump administration," noted Gabriel Ng from consulting firm Capital Economics. The president-elect of the United States, who will take office on January 20, 2025, has promised to boost tariffs on products imported from China.
In the current global context, the Mexican economy should pay close attention to these signals from the Chinese economy, as any adjustments in Beijing's economic policies could impact our bilateral trade. It is crucial for Mexico to enhance its competitiveness and diversify its trade relationships to minimize risks and seize opportunities that may arise in this changing environment.
