China’s economic policymakers have set out a renewed push to strengthen domestic consumption as a central pillar of economic reform, signalling a recalibration of the country’s growth model away from heavy reliance on investment and exports.
The position was articulated by Liao Min, Vice Minister of the Ministry of Finance of the People’s Republic of China, during a meeting of finance and central bank deputies from Asia-Pacific Economic Cooperation (APEC) economies held in Shanghai on Wednesday. Speaking on behalf of the Chinese government, Liao said Beijing is committed to boosting domestic consumption and accelerating reforms aimed at overhauling the structure of the economy.
Policy focuses on consumption and the unified market
Liao explained that China is working to build a unified national market, an initiative designed to remove internal barriers such as local protectionism and fragmented regulation that restrict the free flow of goods, services, and factors of production. Officials believe these distortions have suppressed consumption potential and contributed to inefficiencies and excess capacity in some sectors.
The shift reflects growing recognition among policymakers that household consumption must play a larger role in sustaining economic growth. Services consumption, in particular, was highlighted as an emerging driver of momentum as China pursues what it terms high-quality development, emphasising efficiency, innovation, and improved living standards rather than headline growth alone.
Strategic recalibration amid economic headwinds
China met its economic growth target of around 5 per cent in 2025, but officials acknowledge persistent challenges, including subdued consumer confidence, property sector weakness and external uncertainties linked to global trade tensions. Against this backdrop, boosting consumption is viewed as essential to enhancing the economy’s resilience and reducing vulnerability to external shocks.
Recent policy documents from the State Council have reinforced this direction, calling for measures to expand services consumption in areas such as tourism, healthcare, elderly care and education. These initiatives are supported by targeted financial policies, including improved access to credit for service-sector enterprises and incentives aimed at stimulating household spending.
Economists note that translating policy intent into sustained consumption growth will depend on deeper structural reforms, particularly those that raise household incomes and strengthen social safety nets. Expanding employment opportunities, improving wage growth and reducing precautionary saving are seen as critical to unlocking consumer demand.
Overall, the Ministry of Finance’s messaging points to continuity in China’s broader reform agenda, while underscoring a clearer policy tilt towards consumption-led growth. As global economic conditions remain uncertain, Beijing’s emphasis on domestic demand signals an effort to place the economy on a more balanced and durable footing in the years ahead.