BEIJING: China has committed to a new round of major equipment upgrades and replacement of consumer goods as part of its efforts to boost domestic demand and support sustained economic growth this year.
An action plan issued by the State Council earlier this month said China aims to increase its investment in equipment for industry, agriculture, construction, transportation, education, culture, tourism and medical care by 2027 compared to 2023 by at least by 25 percent.
From 2027, the volume of end-of-life vehicle recycling is set to roughly double from 2023, with used car transactions increasing by 45 percent, the plan says. In addition, by 2027, recycling of used household appliances is planned to increase by 30 percent compared to 2023.
The plan specifies 20 key tasks in five sectors, namely equipment renewal, replacement of consumables, recycling of used goods, standardization and strengthening of policies, and fiscal and financial support.
According to the National Development and Reform Commission (NDRC), the country’s chief economic planner, as a major manufacturing country pushing for new industrialization, China’s demand for advanced equipment and facility modernization continues to grow.
Initial estimates show that upgrading the equipment could create a huge market with an annual scale of more than 5 trillion yuan (about 704.19 billion US dollars), the NDRC said.
According to the action plan, efforts will be made to promote equipment modernization in the direction of energy saving and emission reduction, ultra-low emissions, safe production, digital transformation and intelligent modernization, leading to the promotion of high-tech, green and intelligent industries and further expansion of effective investments.
As a populous country, China’s huge market for automobiles, home appliances, and other consumer durables has led to promising market potential for consumer goods replacement.
The continuous market expansion and increasing consumer demand will open up more opportunities for business development, promote the rapid development of related industries, and promote the modernization of the economic system, the NDRC said.
In addition, the consumer goods exchange will make high-quality durable consumer goods available to residents and meet the diverse needs of consumers, the NDRC added.
Official data shows that the total number of home appliances in China currently exceeds 3 billion pieces, while more than 200 million pieces of home appliances will be discarded in the country in 2023 alone. Total auto sales in China are estimated to exceed 31 million units in 2024, with trade demand accounting for about 44 percent of that total.
According to the NDRC, the modernization of automobiles and home appliances alone is expected to create a trillion-yuan market.
