Beijing plans to encourage domestic consumers to increase their spending by eliminating scams, price gouging and the sales of shoddy goods.

The Chinese government has published an action plan for boosting consumption that focuses on eliminating fraud and other issues that discourage consumers from spending, as it aims to shore up economic growth amid an intensifying trade war with the United States.

The 19-point plan, jointly issued by five government departments, aims to create “a healthier consumption environment” that will boost confidence and encourage consumers to spend more.

The authorities pledged to tackle issues ranging from unclear pricing and false advertising to low-quality products and inadequate consumer protection, with a goal of resolving the problems by 2027.

“Optimising the consumption environment is an important measure to boost consumer confidence and stimulate economic vitality, which is of great significance in promoting high-quality economic development,” the State Administration of Market Regulation said in a statement.

Key measures in the latest initiative include raising quality standards in industries such as automobiles, home appliances and food, while supporting the development of domestically made jewellery, leather goods and other consumer products.

The publishing of the 19-point plan coincides with the announcement from China’s legislators pledging to increasing household disposable income in an effort to boost consumption and shore up the country’s growth momentum.

At an executive meeting in February of the State Council — the country’s Cabinet — policymakers said stimulating consumption was to become the top priority amid efforts to sustain improvements in the domestic economy.

Consumption is poised to contribute 70%-80% to China’s economic growth this year, said Su Jian, director of the National Centre for Economic Research at Peking University, who added that achieving this level of consumption-driven growth will require the government to deploy a comprehensive policy toolkit — including consumer voucher programmes — to stimulate consumer demand.

“As incomes rise, demand for premium products and services is expected to grow,” said Yuan Haixia, executive dean of the Research Institute at CCXI. “By enhancing the quality and variety of products and services available, China can stimulate new consumer demand and unlock untapped market potential.”

China’s demographic trends, especially the aging population, are creating new consumption opportunities in healthcare, senior care, education and other service sectors, Yuan said.

The rapid development of cutting-edge technologies such as the metaverse and artificial intelligence is reshaping China’s consumption landscape, injecting fresh momentum into the economy, he added.

Tech sector benefits from tax breaks

China cut 2.63 trillion yuan ($361 billion) in taxes and fees targeted at technological innovation and high-end manufacturing last year, as the country strives for self-sufficiency in key technologies to maintain its competitive edge amid growing geopolitical and economic pressure.

Latest data from the State Taxation Administration, the country’s top tax authority, showed that tax breaks for companies’ research and development spending and technology transfers totalled 806.9 billion yuan in 2024.

Tax incentives for high-tech enterprises and emerging industries — including a 15% corporate income tax rate and exemptions on new energy vehicle purchases — added up to 466.2 billion yuan last year.

To tackle bottlenecks in core technologies and attract talent in key sectors, China offered an additional 132.8 billion yuan in value-added tax deductions.

Notably, another major boost came from advanced manufacturing, with value-added tax rebates and deductions amounting to 1.11 trillion yuan, underscoring the government’s focus on upgrading production lines and transitioning to high-tech, high-value manufacturing.

Li Xuhong, deputy head of the Beijing National Accounting Institute, said: “Such measures will help taxpayers fully save on operating costs through R&D expense deductions. Relief will further stimulate their vitality and drive innovation capability, all of which will be strong drivers of the development of the country’s private sector.”

VAT invoice data released by the government showed that last year, sales revenue in high-tech industries grew 9.6 percentage points faster than the national average. Revenue from technology commercialization services jumped 27.1 percent year-on-year.

The digital economy also saw steady gains, with core industries expanding 7.1% year-on-year and enterprise procurement of digital technologies rising 7.4%, reflecting deepening integration of digital tools in industrial production.

The Chinese government has unveiled a plan to stabilise foreign investment this year, which analysts say signals the country’s determination to achieve high-level opening-up in the face of rising global protectionism.

The plan, adopted at the State Council executive meeting chaired by Premier Li Qiang, outlined more practical and effective measures to both retain existing and attract new foreign investment because of the vital role that foreign-invested businesses play in terms of job creation, export stability and industrial upgrading.

In a statement, the government said China will fully implement its commitment to remove all market access restrictions for foreign investors in the manufacturing sector and expand the list of sectors encouraging foreign investment.

According to the plan, the country will encourage foreign enterprises to reinvest their capital within the Chinese market and participate more actively in equity investments. Meanwhile, steps will be taken toward optimizing the rules and regulations governing foreign mergers and acquisitions, as outlined in the plan.

Foreign enterprises will be treated on an equal footing with their Chinese counterparts in government procurement, according to the plan, which also put an emphasis on widening the financing options available to foreign-invested enterprises and strengthening intellectual property protection for them.

China will further open up its services sector, with a particular focus on accelerating pilot programs in key areas such as telecommunications, healthcare and education, said Li Yongjie, deputy international trade representative of the Ministry of Commerce.

The country is committed to aligning itself with high-standard international trade and economic rules while building a network of high-level opening-up platforms such as free trade zones as it aims to enhance its overall business environment, Li said.

A total of 59,080 new foreign-invested firms were established across China in 2024, an increase of 9.9% year-on-year, according to data from the ministry.

“These proactive opening-up policies stand in stark contrast with the intensifying investment restrictions tipped by certain economies, and have created a more welcoming and accessible environment for foreign enterprises — particularly small and medium-sized ones — looking to enter the Chinese market,” said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.

While the global economy grapples with sluggish demand, the sheer size of China’s consumer base, the nation’s rising middle class and growing purchasing power have presented a crucial lifeline for foreign enterprises navigating broader economic uncertainties, Zhou added.

Chinese economy expected to rebound 2025

The Chinese economy is expected to rebound in 2025 despite new variables, according to Guan Tao, global chief economist at BOCI China.

He said the unprecedented popularity of domestic travel and the emergence of DeepSeek AI model have boosted confidence in the Chinese economy, as well as creating positive expectations for the future.

Guan said the country plans to further boost consumption among urban residents. Data show that the median nominal per capita disposable income of urban residents grew 4.65% on average between 2020 to 2024.

Furthermore, China needs to promote a new type of urbanization and comprehensive rural revitalization in a co-ordinated manner, promote the integrated development of urban and rural areas, and further stimulate rural consumption potential, he said.

The economist said China’s economic policy focuses have shifted to benefiting people’s livelihood and promoting consumption.

Recently, the government has pre-delivered 81 billion yuan ($11.09 billion) of funds for consumer goods trade-in in 2025 to support local governments in the continuous implementation of the policy.

Moreover, China launched an action plan to promote large-scale equipment renewal and trade-in of consumer goods in March 2024 as part of efforts to boost domestic demand and support economic growth, Guan added.

Protecting their IT networks was the key concern for Malaysian businesses in 2024 when it came to cybercrime, according to the latest Kaspersky IT Security Economics report.

Some 88% of businesses experienced attempts to infiltrate their network, while over 60% of companies reported incidents where bad actors executed malicious code within their network or attempted to communicate with compromised systems and take control.

Large enterprises experienced the highest rate of network security incidents, despite having the most comprehensive protection measures in place. Small and medium-sized companies also faced challenges with network security, with a significant percentage of incidents attributed to the deliberate or inadvertent actions of their own employees.

The Kaspersky IT Security Economics report said that network security threats aim to exploit system vulnerabilities by penetrating company networks and stealing or inflicting damage to sensitive data, applications and workloads.

The report said: “When a cybercriminal detects a weak spot in the system, they use it to gain unauthorized access and install malware, spyware, or other harmful software. These weak spots are also a gateway for social engineering attacks, where individuals become an easier target.

“As more and more data is created, stored and transmitted electronically, the potential for cyber attacks to compromise sensitive information is also increasing. One of the key factors contributing to the ongoing prevalence of network security issues is the growing complexity of cyber threats. “Cybercriminals are constantly developing new tactics and techniques to bypass traditional security measures, making it challenging for businesses to stay ahead of the curve. From phishing scams and ransomware attacks to DDoS attacks and APTs, there are numerous ways in which cyber criminals can exploit vulnerabilities in a company’s network.”

It added: “Furthermore, the rise of remote work and BYOD (bring your own device) policies has created additional challenges for network security. With employees accessing company data from various locations and devices, the potential for security breaches is heightened. This, combined with the lack of proper security protocols and employee training, creates a vulnerable environment for cyber attacks to occur.”

The Kaspersky IT Security Economics report also said that human error is another key factor contributing to security incidents. It said 42% of companies reported incidents where their own employees consciously or unconsciously helped adversaries by their action or inaction, with the majority of these occurrences in medium and small businesses.

It commented: “Mistakes or negligence by employees, whether due to a lack of security awareness or insufficient training, are leading causes of cyber breaches and data leaks in organisations.

“Phishing attacks, where employees unwittingly click on malicious links or provide sensitive information to scammers, are a common threat. Insider threats, where employees intentionally or unintentionally leak confidential data, can also pose a significant risk to a company’s security.

“The consequences of employee negligence in cyber security can be severe as data breaches often result in financial loss, damage to a company’s reputation, and legal repercussions. In extreme cases, companies may face fines and legal action for failing to adequately protect sensitive information.”

SMBs are often more vulnerable to data breaches caused by their own employees than large corporations which have more resources to invest in robust cyber security measures and employee training. Small and medium-sized companies may lack the necessary infrastructure and awareness to adequately protect their sensitive information, making them an easy target for cyber criminals looking to exploit weak links in the security chain.

The report concluded that to mitigate the risk of cyber attacks caused by human error, companies must take steps to raise awareness among employees about cyber threats and invest in comprehensive cyber security training programmes.

It said: “Regular security audits and monitoring can help identify vulnerabilities and address them before they are exploited by cyber criminals. While specialized solutions such as those provided as part of the Kaspersky Next product line can protect a company’s assets with real-time protection, threat visibility, investigation and response capabilities of EDR and XDR for organisations of any size and industry.

“Ultimately, a combination of technological solutions and proactive employee education is essential in safeguarding a company’s data and reputation in the digital landscape.”

Strengthening China-European Union economic co-operation has become crucial for worldwide economic growth, as the United States’ tariff hikes against key trading partners have cast a shadow over the global economy, senior Chinese trade experts have said.

They emphasized that amid growing global trade protectionism, the Chinese and EU’s free trade ethos provide a solid basis for deeper bilateral economic and trade collaboration.

Zhang Yansheng, a researcher at the Chinese Academy of Macroeconomic Research, said the EU economy has advantages in high-end manufacturing, green technology and services trade, while China excels in digital infrastructure and smart manufacturing, and has a vast domestic market.

By creating platforms such as industrial co-operation parks and joint innovation funds, the two sides can create concrete projects, creating a roadmap for them to build a new economic and trade partnership, Zhang said.

“With the transformation and upgrading of China’s manufacturing industry, the competition between China and the EU in economic and trade development has intensified,” Zhang said.

“However, as they both face external challenges like rising protectionism and geopolitical uncertainties, the two economies are expected to forge closer economic ties based on complementary competition, thereby achieving a win-win situation,” Zhang added.

Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation, said the potential for collaboration between China and the EU is enhanced by their complementary markets and shared need for resource optimization.

He said he expects more co-operation between the two sides to boost collaboration by enterprises, drive innovation and improve the allocation of market resources.

“By doing such things, China and the EU could generate significant economic and social benefits, boost employment and enhance supply chain security for both,” said Zhou, whose academy is affiliated with China’s Ministry of Commerce (MOC).

China remains the EU’s largest import source and third-largest export destination, according to European statistics. Moreover, China’s outbound direct investment inflows to the EU grew from €6.27 billion ($6.43 billion) in 2020 to €8.06 billion euros in 2023.

Zhang, from the Chinese Academy of Macroeconomic Research, said that co-operation potential between China and the EU spans three key areas: green transformation, digital development and third-party market growth.

The two economies could build a joint carbon-neutral laboratory focusing on clean technology collaboration, recognize each other’s cross-border e-commerce standards, and build dialogue mechanisms for co-operation in frontier areas like data flow and artificial intelligence ethics, he said.

According to Zhou, from the Chinese Academy of International Trade and Economic Cooperation, China and the EU should focus in the short term on reviewing and strengthening existing supply chain co-operation by reducing trade barriers and increasing investment opportunities and the mobility of personnel.

Long-term strategies should aim for more effective market integration through reduced tariffs, increased consultation mechanisms and enhanced collaboration on innovation, he added.

China sees growth in trade in services in 2024

China’s annual trade in services exceeded one trillion US dollars for the first time last year, demonstrating significant potential for further growth, according to the latest data from the Ministry of Commerce (MOC).

And the country’s services import and export value amounted to a record-high of 7.5 trillion yuan (about $1.05 trillion) in 2024, expanding 14.4% year on year, the ministry said. Exports grew 18.2% year on year and imports grew 11.8%, according to the MOC.

Driven by the global trends of digitisation, smart technology advancement and green development, China’s trade in services grew in scale and its international competitiveness was enhanced in 2024, said Li Jun, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the MOC.

He added that “the comprehensive relaxation and optimization of China’s visa-free transit policy has played a role in boosting inbound tourism over the last year”.

The Chinese government released a guideline on promoting the high-quality development of trade in services through high-standard opening-up in August last year.

The document offers robust policy support for the development of China’s services trade, Li said, calling for more efforts to advance opening-up, innovation and international cooperation in the sector.

Bilateral, multilateral and regional collaboration in digital trade and trade in services should be expanded, Li said, suggesting that the role of major exhibition platforms should continue to be leveraged, and that international services trade co-operation parks should be developed.