Reference News Network, July 21 report - According to the South China Morning Post website on July 18, China has pledged to continue streamlining procedures and attracting foreign investment in the next five years to boost service consumption. In the context of an uncertain international trade environment, the Chinese government is making domestic demand a reliable source of economic growth.

The report said that Minister of Commerce Wang Wentao pointed out at a press conference held in Beijing on the 18th that although service consumption is growing faster than goods consumption, there is still a shortage of high-quality services on the supply side.

He said that to address this shortage, China will "reduce restrictive measures and enrich service supply" during the "14th Five-Year Plan period (2026-2030)", especially in areas such as health and elderly care.

The report said that the world's second-largest economy is currently promoting domestic consumption.

How to tap into China's consumer potential has become a hot topic among academia and policy circles, and it is almost certain to be an important part of China's next five-year plan.

Data shows that in the second quarter of 2025, consumption contributed 52.3% to China's GDP growth, higher than the 51.7% recorded in the previous quarter.

In 2024, China's service retail sales grew by 6.2% year-on-year, 3 percentage points higher than the growth rate of commodity retail sales during the same period, with residents' service expenditure contributing 63% to the growth of consumption expenditure.

However, supply bottlenecks and market access barriers limit the industry from fully realizing its potential.

"The contradiction in this stage of service consumption is mainly a shortage of supply, more precisely, a shortage of high-quality service supply," said Wang Wentao at the press conference.

Another report from the Bloomberg News website on July 19 stated that a senior Chinese official said that China's trade volume with countries around the world is within a reasonable range, and China has no intention of dominating the global market. He cited data showing that China's domestic consumption has become the main driver of economic growth.

Liao Min, Deputy Minister of the Ministry of Finance of China, who was attending the G20 Finance Ministers and Central Bank Governors Meeting in Durban, South Africa, said in an interview on the 18th: "Most of China's production is for meeting domestic demand."

Liao Min also mentioned the latest published GDP growth data, saying that it has contributed to world economic growth at a critical moment. Due to US President Trump's continuous tariff hikes, economists have lowered their global growth expectations for this year. Recent data show that China's economic growth rate in the first half of the year was 5.3%.

"China's certainty and stability are our greatest contribution to the world today, because what the global economy needs most right now is stability and certainty," he said. "We are steadily advancing a consumption-driven economic model while maintaining a relatively balanced foreign trade."

The report said that Liao Min emphasized that from 2021 to 2024, the average contribution rate of domestic demand to China's economic growth reached 86.4%, and the average contribution rate of final consumption to China's economic growth reached 56.2%, an increase of 8.6 percentage points compared to the "13th Five-Year Plan period" (2016-2020).

He also pointed out that China's current account surplus last year, which is the most comprehensive indicator of trade, covering service trade and some financial transactions, was approximately 2.2% of GDP. This level is recognized globally as reasonable, indicating that China's share in global exports is "not too high."

He said that in the long term, the Chinese government will seek to expand the service sector, promote green and digital industries, with the goal of continuously enhancing consumers' ability to consume through economic transformation and upgrading, based on employment and income improvement.

He added that the Chinese government will continue to improve the social security system, including pensions, to ensure long-term stable growth in consumption expenditures. (Translated by Wen Yi, Guo Jun)

Original: https://www.toutiao.com/article/7529418851604234786/

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