China: Key takeaways from the third plenum – UOB Group

China’s economic development plan for the next five years is in the resolution of the third plenum, UOB Group economist Ho Woei Chen notes.

Further easing actions from PBOC

“The resolution of the third plenum contains details of China’s economic development plan for the next five years that is focused on its industrial policy and further deepening of reforms across the economy. Policy tone and direction are in line with recent official comments that have emphasized technology, innovation and security as well as defusing risks in the key areas such as the real estate and local government debt.”

“Amongst the key issues addressed include the fiscal imbalances between the central and local governments, urban-rural integration, demographic challenges and the promotion of the private sector and investment. Improvements in the social security system and the land and hukou reforms will help to increase Chinese consumption in the medium to long term.”

“Timeline and specific details of implementation of measures in the plan is not provided in the document. We expect these to be rolled out through the year with little anticipation from the market. Nonetheless, near challenges remain and we reaffirm China’s growth forecast of 4.9% for 2024 and further easing actions from PBOC.”