China’s recent policy changes indicate a shift in its economic priorities. To combat a significant property market downturn, Beijing is urging local governments to purchase unsold homes using low-interest loans provided by the central bank. It seems that top officials are now emphasizing the importance of boosting domestic demand, a departure from the traditional focus on industrial production as the primary method of stimulating economic growth.
Doubts linger among investors regarding President Xi Jinping’s true stance on real estate and consumption. Despite his previous strict enforcement of anti-speculation measures, including the infamous slogan “housing is to be lived in, not speculated on,” there are signs of a potential change in mindset. Xi’s upbringing during a time when industrial production was paramount in China’s development, leading to neglect of people’s well-being, raises questions about the ability to shift one’s deeply ingrained beliefs.
The question remains whether a person can truly alter their long-held worldviews shaped during their formative years. Xi’s potential pivot towards supporting domestic consumption over industrial production suggests a willingness to adapt to changing economic circumstances. As China continues to navigate economic challenges, the effectiveness of these policy shifts remains to be seen.