How is the central government s new round of trade in different from the past?

Mondo Finance Updated on 2024-02-28

Beijing, February 27 (Zhongxin Financial Reporter Li Jinlei) The fourth meeting of the ** Financial and Economic Committee held a few days ago proposed to encourage and guide the renewal of new large-scale equipment and the trade-in of consumer goods.

Why is it necessary to carry out a new large-scale equipment renewal and consumer goods trade-in at this time? How is it different from the past? Who will benefit?

Why? In fact, the first economic work conference held at the end of 2023 proposed to promote large-scale equipment renewal and consumer goods trade-in with the improvement of technology, energy consumption, emissions and other standards.

The fourth meeting of the first financial committee made specific arrangements, emphasizing the need to play a good policy combination, promote the continuous increase in the proportion of advanced production capacity, more high-quality durable consumer goods into people's lives, waste resources are recycled, and the quality and level of national economic circulation have been greatly improved.

The reason for promoting the renewal of equipment and the trade-in of consumer goods is not only a practical need to stimulate investment and consumption, but also an important measure to promote high-quality development.

Luo Zhiheng, chief economist and dean of the research institute, told China News Finance that China's macroeconomy is currently in the post-epidemic recovery period, and the upward trend has not changed, but it is facing some difficulties and challenges, especially the lack of effective demand, and the low willingness of residents to consume and invest in enterprises.

In other words, this move will strongly promote investment and consumption, which is good for the present and more beneficial for the long term.

Data map: Workers test the products off the production line. Photo by Zhang Jingang.

What's the difference? The meeting required that we should adhere to the market-oriented, first-class guidance, insist on encouraging the advanced, eliminate the backward, adhere to the standard guidance, and orderly improvement.

Emphasizing "market-oriented, first-class guidance", the new first-scale equipment renewal and consumer goods trade-in highlight a stronger market orientation.

Luo Zhiheng believes that this is to avoid one-size-fits-all, sports lead to the squeeze of the market, through policy guidance to let market players decide according to market needs, such upgrading is sustainable, supported by business logic, is conducive to improving the efficiency of financial resources, and avoids possible new overcapacity.

We will strengthen support and guidance, take the improvement of technology, energy consumption, emissions and other standards as the traction, promote the opening of the difficulties of trade-in, stabilize and expand traditional consumption, and better meet the needs of consumer goods replacement and upgrading, all of which will be promoted on the basis of respecting the wishes of consumers. The relevant person in charge of the Ministry of Commerce pointed out at the press conference of the State Council Information Office on January 26.

The new first-scale equipment renewal and consumer goods trade-in also put more emphasis on "standard leading".

It is worth noting that in February, the national government and other departments issued the "Advanced Level of Energy Efficiency, Energy Saving Level and Access Level of Key Energy-using Products and Equipment (2024 Edition)", which divides the energy efficiency level of energy-using products and equipment into three levels: advanced level, energy-saving level and access level. Guide all regions and relevant enterprises to implement product and equipment renovation, encourage energy efficiency and energy saving after renovation, and strive to reach the advanced level of energy efficiency.

Zou Yunhan, deputy director of the Macroeconomic Research Office of the State Information Center, wrote that the last round of trade-in activities was in the stage of popularizing large durable goods, especially in rural areas, and the current round of trade-in is in the stage of upgrading the demand for durable goods, from the pursuit of "whether there is" to "whether it is good or not", especially the pursuit of intelligence and green.

Car data map. Photo by China News Service reporter Chen Wen.

Who will benefit? The meeting pointed out that it is necessary to promote the renewal and technological transformation of various production equipment and service equipment, encourage traditional consumer goods such as automobiles and household appliances to be exchanged for the new, and promote the trade-in of durable consumer goods. Promote large-scale recycling, and strengthen the development of "new +** logistics system and new models. For the trade-in of consumer goods, it is necessary to adhere to the linkage between finance and local governments, and coordinate and support all links in the whole chain to benefit consumers more.

Ordinary people are very concerned about the trade-in of traditional consumer goods such as automobiles and home appliances, which is actually a key point in promoting consumption this year.

The relevant person in charge of the Ministry of Commerce pointed out that China's automobile and home appliance markets have entered the "era of both increment and stock" from the simple "incremental era" to the "era of equal emphasis on increment and stock". In 2023, the number of cars will be about 3400 million units, refrigerators, washing machines, air conditioners and other major categories of household appliances more than 3 billion units, some household appliances have been used for more than 10 or 20 years, and the demand and potential for upgrading are great.

Dong Zhongyun, chief economist of AVIC, believes that policy encouragement will help consumers replace old products and increase their willingness to buy new products, especially the purchase of durable consumer goods such as home appliances and automobiles, which can form a significant driving effect on the overall consumption scale of society.

According to the statistics of relevant departments, in June 2009, in order to expand domestic demand, maintain stable and rapid economic development, and promote the comprehensive utilization of resources and the development of circular economy, the state introduced the "old for new" policy for automobiles and household appliances. In 2010, the two policies continued to be implemented, with remarkable results, driving consumption by more than 170 billion yuan.

Zou Yunhan believes that this round of trade-in activities has absorbed the experience of the previous round of activities, emphasizing the linkage between finance and locality, and emphasizing "overall support for all links in the whole chain". Further optimize the design of this round of policies, fully stimulate the enthusiasm of production enterprises, platform enterprises, first-class enterprises, dismantling enterprises and consumers, give real support to all participants, and implement the original intention of the good policy. (ENDS).

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