China bets on kitchen appliances to boost economy

China is making a significant effort to boost its economy by focusing on the sale of kitchen appliances. The government has introduced a new program that allows consumers to trade in their old appliances for discounts on new ones. This initiative is designed to encourage spending among consumers, which is crucial for economic growth. The trade-in program now includes a variety of household items such as microwave ovens, dishwashers, rice cookers, and water purifiers. Previously, the program only covered electronics like televisions, smartphones, and tablets. By expanding the list of eligible products, the government hopes to stimulate consumer interest and increase sales in the appliance sector. The Chinese economy has been facing several challenges in recent years, including a decline in consumer demand and a serious property crisis. To address these issues, the government has allocated a substantial amount of money, approximately 81 billion yuan, to support the consumer goods trade-in scheme this year. Officials have reported that the program, which began in March, has already shown 'visible effects' in terms of increased sales. According to the Ministry of Commerce, the policies have led to a rise in the sales of major items like home appliances and automobiles. However, some economists are skeptical about whether these measures will be sufficient to significantly boost overall consumer demand. Dan Wang, an economist based in China, expressed concerns that the trade-in program is 'far from being enough to boost consumption. ' He noted that while the initiative has supported sales of certain goods, it has not resulted in a substantial increase in overall spending. Harry Murphy Cruise, the head of China economics at Moody's Analytics, echoed this sentiment, stating that although sales of cars and appliances have improved, it has not translated into a broader uptick in consumer spending. In recent months, China has been implementing additional measures to support its domestic economy as exporters face increasing challenges. In December, a crucial meeting of China's leaders emphasized the need for 'vigorous' efforts to enhance consumer spending. This call to action comes at a time when the new president of the United States, Donald Trump, is expected to make decisions that could impact Chinese-made products. Looking ahead, China is set to announce its economic growth figures for 2024 next week, with expectations of around 5%. This figure reflects the government's hope for a more robust economic recovery in the near future.