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Applications Open for the Watching China Course - China 'Has Full Confidence in Achieving This Year’s Economic Growth Target' - Pursuing a New Model for Real Estate Development
Hello everyone,
Let me begin today by sharing that the applications for my Watching China course are now open. The course will run every Saturday from February 1, 2025 to March 1, 2025. All the details with regard to the curriculum, learning outcomes, admissions process and fees are available on this page.
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Warmly,
Manoj Kewalramani
Here are the key reports and articles that I found noteworthy from the People’s Daily’s edition on Monday, December 09, 2024.
Page 1: We have a report on the publication of a new book of Xi Jinping’s discourses. This one deals with his remarks about upholding and improving the system of people’s congresses. Xinhua says:
“The book features a collection of 37 important works by Xi expounding on the theme between December 2012 and October 2024. Some of these works are made public for the first time. Since the 18th National Congress of the CPC in 2012, the CPC Central Committee with Xi Jinping at its core has comprehensively strengthened the Party’s leadership over the work of people’s congresses and vigorously promoted whole-process people's democracy. Xi has integrated the basic tenets of Marxism with China’s specific realities and fine traditional culture, systematically summarized the practical experience of the CPC in strengthening socialist democracy, continuously advanced theoretical and practical innovations of the system of people’s congresses, and put forward a series of new thinking, new ideas and new requirements, thus providing the fundamental guidance for upholding, improving and running well the system of people’s congresses.”
Next, today marks the beginning of a new series on the Chinese economy. It says that the “overall economic operation is stable” and “high-quality development is being steadily promoted.”
It says that “in the first three quarters, China’s GDP grew by 4.8% year-on-year, laying a solid foundation for achieving the annual target. ‘China has full confidence in achieving this year’s economic growth target and continuing to serve as the biggest driver of global economic growth’.” 前三季度,我国国内生产总值同比增长4.8%,为实现全年目标打下了坚实的基础。“中国有充足信心实现今年经济增长目标,继续发挥世界经济增长最大引擎作用.”
The first section of the article says that through this year “stability has been consolidated.” The key points made are:
Although the growth rate has fluctuated through the year, it has remained near the expected target
10.49 million new jobs were created in urban areas across the country in the first three quarters. The employment situation is “generally stable.”
Prices have risen “moderately”
Balance of payments has been maintained
In October, China’s manufacturing PMI returned to expansion range, at 50.1%; and the consumer confidence index rebounded by 1.2 percentage points from the previous month, the first rebound after a continuous decline for 6 months.
The annual railway passenger volume exceeded 4 billion people
The annual express delivery business volume exceeded 150 billion pieces
“Looking back, this year’s economic achievements in China have not come easily. A series of existing policies and new measures have worked in synergy and delivered sustained results, helping the economy stabilise, and continue improving.” 回首来路,今年中国经济答卷来之不易。一系列存量政策和增量政策协同发力、持续显效,助力经济筑底企稳、持续向好.
Then the piece talks about the policy steps that have been taken. Among these, it says:
“The issuance of new special bonds reached 3.9 trillion yuan; 10 trillion yuan in local debt resolution resources were added, forming a ‘combination punch’ for debt resolution; starting September 27, the RRR was lowered by 0.5 percentage points, releasing approximately 1 trillion yuan in long-term liquidity ... With the effective implementation of proactive fiscal policies and prudent monetary policies, positive factors are continuously increasing.” 新增专项债发行达3.9万亿元;增加地方化债资源10万亿元,形成化债“组合拳”;9月27日起下调存款准备金率0.5个百分点,释放长期流动性约1万亿元……实施好积极的财政政策和稳健的货币政策,积极因素不断增多.
The piece mentions policies related to the ‘two heavy’ and ‘two new’ goals, real estate policies, etc.
The second section talks about the focus on technology and innovation. It says:
In the first 10 months, investment in high-tech industries increased by 9.3% year-on-year, and the number of invention patents authorised was 889,000; in October, the added value of high-tech manufacturing increased by 9.4% year-on-year. 前10月,高技术产业投资同比增长9.3%,发明专利授权量为88.9万件;10月高技术制造业增加值同比增长9.4%.
The piece highlights some breakthroughs, such as the formal commercial operation of China’s first self-developed F-class heavy-duty gas turbine. This happened in late November. It mentions the C919 aircraft being picked up by three airlines and Origin Wukong, China’s third-generation superconducting quantum computer, going into operation.
It adds:
“In the first three quarters, listed companies invested 1.10 trillion yuan in R&D, up 3.9% year-on-year; by the end of October, the number of domestic valid invention patents reached 4.66 million ... R&D investment increased, innovative achievements emerged, and industrial upgrading took solid steps. In 2024, China’s global innovation ranking jumped to 11th place…” 前三季度上市公司研发投入达1.10万亿元,同比增长3.9%;截至10月底,国内有效发明专利拥有量达到466万件……研发投入增加,创新成果涌现,产业升级迈出坚实步伐。2024年,我国在全球的创新力排名跃升至第十一位,是拥有百强科技创新集群最多的国家.
“A total of 4.141 million 5G base stations have been built, with over 15,000 ‘5G + Industrial Internet’ projects, and more than 4,500 enterprises in the core artificial intelligence industry ... Efforts are accelerating in deploying new industries and new tracks such as the low-altitude economy, commercial space, and bio-manufacturing. Emerging industries are developing rapidly, and new drivers of growth are continuously accumulating.” 累计建成5G基站414.1万个,“5G+工业互联网”项目超过1.5万个,人工智能核心产业企业数量超过4500家……加快布局低空经济、商业航天、生物制造等新产业新赛道,新兴产业加快发展,新动能不断集聚。
The final section talks about policies related to reform and opening up.
Finally, there’s a report informing that “as of 24:00 on December 6, 29.638 million consumers had purchased 45.85 million units of eight major categories of home appliances, driving sales of 201.97 billion yuan, with over 90% of the sales revenue coming from first-level energy-efficient products. Recently, various regions have actively promoted home appliance trade-in programs, with policy effects becoming increasingly evident. Nationwide, it took 79 days for trade-in sales to surpass 100 billion yuan, while the jump from 100 billion to 200 billion yuan took only 40 days, accelerating the release of consumption potential for upgrades.”
Page 6: Today’s Xinhua piece on the economy deals with the policy shifts in the property sector since the September 26 Politburo meeting. The first sentence says that “the housing issue is both a people’s livelihood issue and a development issue.” 住房问题,既是民生问题也是发展问题.
The article says that after the Politburo meeting, “multiple departments introduced policies to promote the stable and healthy development of the real estate market, summarised as ‘Four Cancellations’, ‘Four Reductions’, and ‘Two Increases.’ Many regions, especially first-tier cities, have actively adjusted and optimized related policies to help the market recover…Local governments have implemented city-specific measures to cancel or reduce restrictive policies, unlocking housing demand; tax policies have been optimized to lower transaction costs; land policies have been adjusted to control new supply and manage existing inventory, enhancing the ‘reservoir’ function of land reserves; and financial support has been increased, injecting liquidity into the sector. How effective have these policy combinations been? Let’s observe several key indicators.”
The first indicator is sales data:
“The latest data from the NBS shows that, from the sales situation of 40 key cities monitored, second-tier cities that previously had experienced larger declines earlier showed significant marginal improvement, with monthly sales area in October achieving positive growth, and the decline in sales volume narrowing significantly. From January to October, the nationwide newly-built commercial housing sales area year-on-year declined by 15.8%, with the decline range narrowing by 1.3 percentage points compared to January to September; newly-built commercial housing sales amount year-on-year declined by 20.9%, with the decline range narrowing by 1.8 percentage points compared to January to September. The online signing data of the Ministry of Housing and Urban-Rural Development showed that in October, the online signing volume of newly-built commercial housing transactions in China increased by 0.9% year-on-year, the first growth after 15 consecutive months of decline; the total transaction volume of newly-built commercial housing and second-hand housing increased by 3.9% year-on-year, the first growth after 8 consecutive months of decline. 9月26日中共中央政治局会议后,多部门打出促进房地产市场平稳健康发展政策“组合拳”,概括起来,就是“四个取消”“四个降低”和“两个增加”。各地特别是一线城市纷纷调整优化房地产市场相关政策,力促市场回暖。不同举措,从不同角度,直击当下房地产市场“痛点”“堵点”:地方因城施策取消或调减限制性措施,释放购房需求;优化税收政策,降低购房交易成本;调整土地政策,控新增、盘存量,进一步发挥土地储备“蓄水池”功能;加码金融支持,为行业流动性注入“活水”……这一套政策“组合拳”效果怎样?我们观察几个关键指标。看销售面积——国家统计局最新数据显示,从监测的40个重点城市的销售情况看,前期回调幅度较大的二线城市边际改善比较明显,10月份当月销售面积实现正增长,销售额降幅明显收窄。1至10月,全国新建商品房销售面积同比下降15.8%,降幅比1至9月收窄1.3个百分点;新建商品房销售额同比下降20.9%,降幅比1至9月收窄1.8个百分点。住房城乡建设部网签数据显示,10月份,全国新建商品房交易网签量同比增长0.9%,连续15个月下降后首次实现增长;新建商品房和二手房成交总量同比增长3.9%,连续8个月下降后首次实现增长.
The second indicator is that the number of visits to first-hand houses and the number of viewings of second-hand houses have increased significantly. The third indicator is market confidence.
It says that “According to the PMI survey, the real estate business activity index in October rebounded by 2.5 percentage points from the previous month, and the market expectation index rebounded by 1.8 percentage points. This indicates that under the influence of various policies, the real estate market's prosperity has begun to recover.” 根据PMI调查,10月份房地产业商务活动指数比上月回升2.5个百分点,市场预期指数回升1.8个百分点。这表明在一系列政策推动下,房地产市场景气度开始改善。
The section ends by quoting the National Bureau of Statistics and the Ministry of Housing and Urban-Rural Development as assessing that:
“‘Overall, the comprehensive set of measures to promote the stabilisation of the real estate market has shown effectiveness, with positive changes appearing in the real estate market in October. As the policy effectiveness of various measures continues to be released, the momentum to drive real estate market stabilisation will strengthen’ … ‘Under the effect of a series of policies, after three years of adjustment, China's real estate market has begun to bottom out’.” “总的来看,一揽子促进房地产市场止跌回稳的措施显效,10月份房地产市场出现积极变化。随着各项政策效能进一步释放,推动房地产市场止跌回稳的动能将增强。”“中国的房地产在系列政策作用下,经过三年的调整,市场已经开始筑底.”
The second section argues that:
“On the one hand, we should see that the package of policies has begun to take effect; on the other hand, we should also see that the bottoming out of the real estate market is a process that requires a combination of long-term and short-term measures, addressing symptoms and root causes.”
First, we must ‘adapt to the new situation in which the supply and demand relationship of China’s real estate market has undergone major changes’. This was a major judgment made by the Politburo of the CPC Central Committee on July 24, 2023. To understand the current real estate situation, we must first grasp this change. The supply and demand relationship is a key factor affecting market prices, which is one of the basic principles of economics. Over the past 20-plus years, China’s real estate market has generally shown an upward trend, playing an important role in guaranteeing and improving people’s livelihood and supporting China’s economic and social development. At the same time, the rapid expansion of the real estate market also saw some issues such as excessive capital concentration in real estate, and some real estate enterprises exhibiting ‘high debt, high leverage, high turnover’. From the past, when supply fell short of demand, leading to a booming market and even price distortions, to recent years, where the main contradiction has shifted from total quantity shortage to basically balanced total quantity with structural supply insufficiency, the underlying logic of the real estate market has changed. (Note: My understanding of this is that there are enough units available in the market but these do not match with consumer demand requirements, either in type, quality or price, etc.) Therefore, to further stabilize and improve the real estate market, commercial housing construction must focus on ‘strictly controlling new supply, optimizing existing inventory, and improving quality’. From the perspective of existing stock, China’s new commercial housing supply scale is large, and stock digestion is an important adjustment direction. At the policy level, it has been clearly stated that in cities with relatively large commercial housing inventory, the government can purchase as needed, actively supporting the acquisition of existing commercial housing for use as affordable housing. Currently, various regions are accelerating the process of acquiring existing commercial housing for use as affordable housing, and special bond support for reclaiming idle existing stock land and adding new land reserves is also being rapidly implemented. From the perspective of increments and quality, people’s housing demand has transformed from focussing on whether one has or not to quality, and meeting this market demand is an important direction for adjusting increments and improving quality.” 一方面要看到,一揽子政策开始落地显效;另一方面也要看到,房地产市场筑底是一个过程,需要长短结合、标本兼治。首先,要“适应我国房地产市场供求关系发生重大变化的新形势”。这是去年7月24日中共中央政治局会议作出的重大判断。认识当前的房地产形势,首先要把握住这个变化。供求关系是影响市场价格的关键因素,这是经济学的基本原理之一。过去20多年,我国房地产市场总体呈现上升态势,对保障和改善民生、支撑我国经济社会发展发挥了重要作用。同时,房地产市场快速扩张,也出现了一些资金过度向房地产集中,部分房企“高负债、高杠杆、高周转”等问题。从过去供不应求形成的市场火爆甚至价格扭曲,到近些年主要矛盾从总量短缺转为总量基本平衡、结构性供给不足,房地产市场的底层逻辑发生变化。因此,要促进房地产市场进一步止跌回稳,对商品房建设要“严控增量、优化存量、提高质量”. 从存量上看,我国新建商品住房供应规模大,存量消化是重要调整方向。政策层面已经明确,商品房库存较多的城市,政府可按需定购,积极支持收购存量商品房用作保障性住房。目前,各地加速推进收购存量商品房用作保障性住房,专项债券支持回收闲置存量土地、新增土地储备也在加快落地。从增量和质量上看,人们对住房的需求已经从“有没有”向“好不好”转变,满足这部分市场需求是调整增量和提高质量的重要方向.
“Secondly, it is essential to repair the credit chain, rebuild market confidence, and promote a virtuous cycle between finance and real estate. Winning the battle to ensure housing delivery is the top priority among these. For some time, during the adjustment of the real estate market, some commercial housing projects that are under construction or have been pre-sold have faced difficulties in delivery due to funding and debt problems. This phenomenon not only seriously damages the rights and interests of home buyers, but also affects market confidence and hinders the orderly operation of the market. In response to this ‘pain point’, the work of ensuring the delivery of houses has been steadily promoted, and the urban real estate financing coordination mechanism has been launched in a timely manner — incorporating compliant real estate projects into a ‘white list’, ensuring all eligible projects receive loans, satisfying projects’ reasonable financing needs. This has become an important measure and strong guarantee for achieving a virtuous cycle between financial and real estate and improving market expectations. At present, 297 cities at or above the prefecture level across the country have established a real estate project financing coordination mechanism. As of October 31, 2024, the amount of loans approved for ‘white list’ projects exceeded 3 trillion yuan. By the end of the year, as the ‘white list’ is expanded in an orderly manner, this scale will increase to 4 trillion yuan. The increase in the scale of credit indicates that the financing of real estate projects is picking up pace and becoming more convenient, and the continued advancement of guaranteed housing delivery is increasingly secure. As of November 13, 2024, the battle for guaranteed housing delivery has been vigorously promoted, and 2.85 million units have been delivered nationwide. This has not only protected the legitimate rights and interests of home buyers, but also effectively improved market expectations. In addition, it is necessary to release the potential demand of the market and further activate the real estate market from both the supply and demand sides. Based on the current main contradiction in the real estate market, in terms of supply structure, the supply of affordable housing is relatively insufficient, housing prices in large cities are high, and the housing burden of new citizens and youth is relatively heavy. In terms of housing demand, improved housing demand continues to upgrade, with residents' desire to enhance living quality becoming stronger. Therefore, by ‘four cancellations’ and ‘four reductions’ to lower purchasing costs and increasing affordable housing construction and urban village transformation will inject new demand into the real estate market. From the medium and long-term trend of the real estate market, there is still development space in meeting the rigid and improved housing needs. China is still in the middle to late stages of urbanization, and continuously promoting people-oriented new-type urbanization will release greater real estate market demand potential.” 其次,要修复信用链条,重建市场信心,促进金融和房地产良性循环。打好保交房攻坚战是其中的重中之重。一段时间以来,在房地产市场调整过程中,由于资金问题、债务问题,部分在建已售的商品住房项目面临交付困难。这一现象不仅严重损害购房者权益,也影响着市场的信心,阻碍着市场的有序运转。针对这一“痛点”,保交房工作稳步推进,城市房地产融资协调机制适时推出——将合规房地产项目纳入“白名单”,应进尽进、应贷尽贷,满足项目合理融资需求,成为实现金融和房地产良性循环、改善市场预期的重要举措和有力保障。目前,全国297个地级及以上城市均已建立房地产项目融资协调机制。截至10月31日,“白名单”项目贷款审批通过金额超3万亿元。年底前,随着“白名单”扩围有序推进,这一规模还将增加到4万亿元。信贷规模的增加,预示着房地产项目融资更快捷更便利,保交房的继续推进更有保障。截至11月13日,保交房攻坚战推进有力,全国已交付285万套,保障购房人合法权益的同时,也对市场预期带来有效改善。此外,还要释放市场潜在需求,从供需两端着手进一步激活房地产市场。立足当前房地产市场的主要矛盾,在供给结构方面,保障性住房供给相对不足,大城市房价高,新市民、青年人住房负担较重。住房需求方面,改善性住房需求持续升级,居民对提升居住品质的愿望更为强烈。因此,通过“四个取消”“四个降低”降低购房成本,加大保障房建设以及城中村改造等,将为房地产市场注入新的需求。从房地产市场的中长期趋势来看,满足刚性和改善性住房需求仍有发展空间。我国仍处于城镇化发展中后期,持续推进以人为本的新型城镇化,将释放房地产市场更大需求潜力.
The final section says that the earlier real estate sector “development model is no longer adapted to the new requirements of high-quality development”.
It adds that “accelerating the construction of a new real estate development model is the fundamental solution for stable and healthy real estate market development. Better satisfying rigid and improved housing needs, perfecting real estate development, transaction and usage systems, establishing a new mechanism for coordinated linkage of the factors of ‘people, houses, land, and money’ are important aspects of accelerating the construction of a new real estate development model.” 加快构建房地产发展新模式,是房地产市场平稳健康发展的治本之策。更好满足刚性和改善性住房需求,完善房地产开发、交易和使用制度,建立“人、房、地、钱”要素联动新机制等,是加快构建房地产发展新模式的重要内容.
“Creating safe, comfortable, green, and intelligent houses has become an important path to meet people’s beautiful life needs, and is also the rightful meaning of promoting high-quality development of the real estate industry. From supporting urban expansion to participating in urban renewal, from driving growth through new supply to linking new supply with existing stock... Real estate development must focus on the diversified housing needs of the people in the new development stage, addressing aspects such as outdoor environments, age-friendly design, and green low-carbon features, and promoting a comprehensive upgrade in the quality of housing construction. At present, the policy support scope for urban village renovation has expanded from only 35 major cities at the beginning to all cities at prefecture level and above. A total of 1,632 urban village renovation projects have been implemented in major cities. From January to October, 3.17 million sets of affordable housing and urban village renovation resettlement housing have been built and raised nationwide; by the end of this year, more than 10 million people in need can be helped to improve their housing conditions. Actively implementing urban renewal actions is an important measure to transform urban development methods and achieve high-quality development. Systematically promoting ‘four good’ construction, i.e., construction of good houses, good neighborhoods, good communities, and good urban areas, is the focus of real estate industry’s future development. The nation has implemented over 66,000 urban renewal projects, with cumulative investment of 2.6 trillion yuan. The comprehensive effectiveness brought by urban renewal actions is gradually emerging. In 2024, the plan was to begin renovation of 54,000 old urban residential areas; 53,000 of these have already started in the first 10 months. Coordinated linkage and preventing dramatic fluctuations are key to achieving stable, healthy, and high-quality real estate market development.” 我国房地产市场已走过20多年高速扩张阶段,过去的发展模式已不适应高质量发展的新要求,构建房地产发展新模式是大势所趋。打造安全、舒适、绿色、智慧的好房子,成为满足人民美好生活需要的重要途径,也是促进房地产业高质量发展的应有之义。从支撑城市扩张转向参与城市更新,从增量拉动转为增量存量联动……房地产发展要围绕老百姓在新发展阶段的多样化住房需求,从户外环境、适老化、绿色低碳等方面着力,推动住房建设品质全面升级。当前,城中村改造的政策支持范围从最初只有35个大城市扩大到全部地级及以上城市。已有1632个城中村改造项目在各大城市落地。1至10月,全国已建设筹集保障性住房和城中村改造安置房317万套(间);到今年底,可帮助超过1000万困难群众改善住房条件。积极实施城市更新行动,是转变城市发展方式、实现高质量发展的重要举措。系统推进好房子、好小区、好社区、好城区“四好”建设,是房地产业未来发展的重心。全国已实施城市更新项目超过6.6万个,累计完成投资2.6万亿元,城市更新行动实施带来的综合性成效正在逐步显现。2024年,全国计划新开工改造城镇老旧小区5.4万个,前10个月已开工5.3万个.
Page 15: There’s an article by Ding Duo, deputy director of the Research Center for Ocean Law and Policy, the National Institute for South China Sea Studies.
Ding’s basic argument is that “the Philippines’ violations of China’s territorial sovereignty and maritime rights and interests, as well as other practices that deviate from the track of resolving disputes through negotiation and consultation and maliciously escalate the situation, violate international law, including the UN Charter, go against the spirit of the Declaration on the Conduct of Parties in the South China Sea, and undermine peace and stability in the South China Sea and the region.”
The specific things that he points to are:
“Instigated by extra-regional countries, the current Philippine government has frequently infringed, provoked and created trouble at at Huangyan Island (Scarborough Shoal), Ren’ai Reef (Second Thomas Shoal), Xianbin Reef (Sabina Shoal), Tiexian Reef (Sandy Cay) and other places, hyping the so-called illegal arbitration ruling of the South China Sea case in the international public opinion arena, disguising itself as a victim to deceive the world. Such manipulation cannot change the mainstream perception of the South China Sea issue within the international community, nor can it change China’s firm will to defend its territorial sovereignty and maritime rights.” 受域外国家鼓动,本届菲律宾政府在黄岩岛、仁爱礁、仙宾礁、铁线礁等地频繁侵权挑衅、制造事端,在国际舆论场上炒作所谓南海仲裁案非法裁决,假扮受害者诓骗世人。这种操弄改变不了国际社会对南海问题的主流认知,更改变不了中国维护自身领土主权和海洋权益的坚定意志.
Ding ends with this:
“For a long time, China has resolutely safeguarded its legitimate rights and interests in the South China Sea, firmly maintained peace and stability in the South China Sea, and insisted on resolving disputes through negotiation and consultation. China’s claims and position will not change due to fluctuations in the maritime situation, and China’s determination and will will not be shaken by external interference. The Philippine side should abandon any baseless, unreasonable, and unhelpful fantasies, and work with China to seek a stable and long-term solution to the South China Sea issue.” 长期以来,中国在南海问题上始终坚决维护自身合法权益,坚定维护南海和平稳定,坚持以谈判协商解决争端。中国的主张和立场不会因海上局势的起伏而变化,中国的决心和意志不会因域外国家的干扰而动摇。菲方应放弃任何于法无据、于理不合、于事无补的幻想,同中国相向而行,寻求南海问题的稳妥长久解决之道.
Finally, there’s a statement from the Chinese Ministry of Foreign Affairs on the developments in Syria. It said:
“China is closely following the situation in Syria and hopes that stability will return as soon as possible. The Chinese government has been actively helping Chinese nationals who wish to leave the country to do so in a safe and orderly way, and staying in contact with those Chinese still in Syria and offering them advice on how to stay safe. We urge relevant parties in Syria to ensure the safety and security of the Chinese institutions and personnel in Syria. The Chinese Embassy is still up and running and carrying out its duty in Syria. We will continue to make every possible assistance to Chinese nationals in need.”