China will provide nearly $9 billion to subsidise its consumer goods trade-in drive next year, extending a stimulus program aimed at shoring up domestic demand and countering external headwinds faced by the world’s No. 2 economy.
The government plans to raise 62.5 billion yuan ($8.9 billion) to fund the first tranche of subsidies by selling ultra-long special sovereign bonds, the National Development and Reform Commission, China’s top economic-planning agency, said in a statement Tuesday.
The authorities will guide local governments to “pace the implementation appropriately and use the subsidies in a balanced and orderly way,” to maximise the impact of the policy, it added.
The Chinese government has been offering the subsidies since mid-2024 to stabilise consumption battered by a years-long housing slump and persistent deflation. The authorities have made expanding domestic demand their top economic priority next year as they remain vigilant for emerging tensions with other countries despite a tariff truce with the US.
A total of 300 billion yuan in subsidies was allocated this year for supporting purchases of consumer goods from cars and smartphones to home appliances, double the amount seen in 2024.
Learn more:
China Consumer Prices Unexpectedly Rise on Holiday Demand
China’s consumer prices unexpectedly increased in October, as holidays during the month boosted travel, food and transport demand.
