MNI China Press Digest June 5: NEV, Rebalancing, Housing

Highlights from Chinese press reports on Monday:

• China will optimise tax reduction and exemption policies for new energy vehicles (NEV), according to a recent State Council meeting. Leaders noted developing the NEV market was key to upgrading the automotive industry and would support the sustained recovery of the wider economy. The NEV industry will receive support to strengthen core technology and develop intelligent driving systems, the council said. Cui Dongshu, secretary general at the National Passenger Car Market Association, said policy support would increase NEV consumption and promote sustainable growth in the industry. (Source: Yicai)
• China needs to transition away from its investment-led growth model and rebalance national income towards household consumption, according to Teng Tai, president at Wanbo New Economy Research Institute. Teng said the economy’s investment led growth model was increasingly unproductive and achieving the Government’s Strategic Plan for Expanding Domestic Demand (2022-2035) depended on boosting the household share of national income. The Government can achieve rebalancing through reforms to taxation and eliminating excess profits in land, finance, information technology services, energy, and increasing transfer payments. (Source: Yicai)
• Qingdao's local government will introduce new policies to support the housing market, according to the Qingdao Housing and Urban Rural Development Bureau. Local authorities issued a notice detailing the support measures, which included lowering down payments and increasing consumption vouchers. Authorities said they would prioritise help for young people and also buyers wanting to purchase new builds. In the rental market, enterprises will be supported to issue bonds for the construction of rental property. (Source: Yicai)