Authoritative Analysis: Where Will China’s Economy Find Its Momentum in the Second Half of the Year?

Release Date:

2025-07-20

On July 15, the State Council Information Office held a press conference to present an overview of China’s economic performance in the first half of 2025 and to answer questions from reporters. Sheng Laiyun, Deputy Director of the National Bureau of Statistics, stated that China’s economy is expected to maintain a steady yet progressive momentum, with continued improvement, in the second half of the year.

Sheng Laiyun stated that the economy’s steady and progressive performance in the first half of the year has laid a solid foundation for achieving the annual targets. Secondly, over the years, the overarching trend and practical efforts toward high-quality development have fostered broad consensus, built up new drivers of growth, rebalanced the economy, and enhanced its capacity for sustainable development. Thirdly, the coordinated implementation of macroeconomic policies will provide robust support for maintaining stable economic performance.

On July 4, the opening ceremony of the film market and the launch event for the exhibition of cinematic technological achievements of the 2025 Shanghai Cooperation Organization National Film Festival were held at the Chongqing Yongchuan International Convention and Exhibition Center. Guests viewed virtual films produced by Chinese film technology companies. Photo by Xinhua News Agency reporter Chen Cheng.

Xiao Lisheng, Director of the Global Macroeconomics Division at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences, believes that since the beginning of this year, domestic policies have been steadily strengthened. Judging from government bond issuance, fiscal policy has clearly been front-loaded. The reserve requirement ratio cut and interest rate reductions implemented in May have both laid a solid foundation for stabilizing and reviving the domestic economy. He suggests that, as we enter the second half of the year, given that earlier subsidy measures targeting certain durable consumer goods have already yielded significant results, it would be appropriate to extend these policies to service sectors such as culture, tourism, and catering.

On May 20, Australian tourists posed for a group photo at the Qishier Qi Lou Scenic Area in Zhangjiajie. With the implementation of a series of measures to facilitate entry, an increasing number of foreign visitors are coming to Zhangjiajie, Hunan, to explore its breathtaking landscapes and rich cultural heritage. Photo by Xinhua News Agency reporter Xue Yuge.

In the second half of the year, the “trade-in” policy is expected to expand into the services‑consumption sector. On June 24, the People’s Bank of China and five other departments jointly issued the “Guiding Opinions on Financial Support for Boosting and Expanding Consumption,” aiming to broaden financial supply in the consumption domain. Qi Yunlan, deputy director of the Research Office and a researcher at the Institute of Market Economy of the Development Research Center of the State Council, notes that income‑enhancing measures—such as raising pensions and increasing subsidies for low‑income groups—are steadily advancing, providing solid support for strengthening residents’ purchasing power, improving expectations, and bolstering consumer confidence. In addition, this year the number of countries eligible for unilateral visa‑free entry into China has expanded to 47, injecting new vitality into the inbound consumption market by attracting more foreign tourists to visit, shop, and explore China.

On June 22, elderly residents lined up to collect meals at the “Happiness Canteen” in QiuChuan Town, Changshan County, Quzhou City, Zhejiang Province. Photo by Xinhua News Agency reporter Jin Liangkuai.

Tian Xuan, Dean of the National Institute of Financial Research at Tsinghua University, stated that in the second half of the year, efforts should be accelerated to issue special-purpose local government bonds and, in particular, national government bonds. Expenditure should be more heavily oriented toward human capital—investing in areas such as elderly care, education, and healthcare—thereby bolstering social welfare. At the same time, a range of measures can be implemented to reduce corporate financing costs, thereby enhancing firms’ investment incentives.

Sheng Laiyun stated that, in accordance with the central government’s directives, relevant departments have recently accelerated the rollout of policies for the second half of the year, which will continue to provide crucial support for the stable operation of the economy. China’s economy is expected to maintain a development trajectory of steady progress and improving prospects in the second half of the year.