China hints at more business support and less fiscal stimulus

China’s government announced its intention to focus on supporting the country's economy in the upcoming year. In this regard, business-friendly policies are likely to be created. However, fiscal stimulus may be reduced.

According to this statement, in 2023 China will be focused on increasing the country's GDP to the target level of 5% or higher. Some officials see this level as a necessary minimum that China's economy should reach in the upcoming years. It’ll allow the country to act in line with its long-term prospects. 

Officials said that next year there will be policies aimed at encouraging the growth and development of private enterprises. There will also be more access for foreign companies to the Chinese market.

At the same time, China's fiscal policy will remain focused on GDP growth. The government intends to maintain a set level of government spending, ensure fiscal sustainability, and keep debt risks under control.

UBS economists noted that all of these factors may indicate a continuation of an active fiscal policy with less stimulus than last year.