“CAUTIOUS” APPROACH IN BOOSTING Use
Since 2021, China’s government has introduced a series of procedures aimed at redistributing income and wealth, generally framed under the symbol of” popular prosperity”, says Mr Xu.
This has led to reprisals on high-paying companies like tutoring, the financial industry, and the software market.  ,
” While these methods were intended to address income inequality, the effects have been significant, with the economy suffering greatly.”
Yet, there seems to be a change in the government’s strategy. According to Mr. Xu, new Third Plenum policies may recommend a move toward encouraging urbanization and stimulating migrant workers to settle in cities, work for a regular job, and perhaps even buy homes.  ,
Instead of focusing only on lowering the earnings of the rich, the goal is to encourage growth in income among the lower-income groups. This technique, while encouraging, is unlikely to produce immediate results, and perhaps get five to 10 years to materialise- if it succeeds at all, Mr Xu adds.
Mr. Yu remarked that” the state is very evident that they do need to pull domestic consumption, and today’s situation is not appropriate for them.”
They want to really deepen the reform and finish a number of tasks in order to improve the Taiwanese economy’s quality, not just its quantity.
Amid these coverage shifts, Chinese homes, especially in the country’s largest towns, are exhibiting a designated caution in their investing. The rapid drop in housing costs in these urban centers is one of the main causes of this.  ,
Previous tenacious housing markets started to deteriorate in mid-2023, according to EIU’s Mr. Xu, following the trend of smaller towns that saw value declines in 2021 and 2022. This decline has resulted in a bad success effect, where people’s spending is influenced by both their perceived wealth and their income.
The government’s assault on well-paying work in major Chinese cities has even contributed to this precaution. For example, investment banking incomes have dropped to as low as quarter of what they once were, causing consumer spending to decline. This trend is further demonstrated by a 7 % decrease in China’s personal income tax income this year.
” If you see a really small cut in personal income tax paid, that may indicate that all those who enjoy good jobs may have experienced a significant decline. So that’s possibly explaining why usage has been more careful”.
Kantar Worldpanel’s Mr Yu believes there’s a lot of “big intentions” behind driving use, although those are “grand approaches to translate into substantial policy, and may take some time”.