No sign of major stimulus from Beijing 

Real estate stock prices soared today in Hong Kong and Shanghai, but dry bulk owners hoping for a big stimulus announcement from yesterday’s Politburo meeting in Beijing will be disappointed with the range of economic measures outlined. 

China’s top leaders pledged on Monday to ramp up policy support to boost domestic consumption as the economy struggles to fire post-covid. 

In a 17-point statement Monday, the National Development and Reform Commission (NDRC) pledged to attract more private capital to participate in the construction of major national projects and key industrial chain supply chain projects.

The NDRC said it will support private investment in sectors — such as transportation, water conservancy, clean energy, new infrastructure, advanced manufacturing and modern agriculture facilities.

The agency is also encouraging private investment projects to issue real estate investment trusts (REITS) in the infrastructure sector to promote asset diversification and further broaden investment and financing channels for private investment.

China will adjust and optimise property policies in a timely manner, in response to “significant changes” in the supply and demand relationship in the property market, it said.

“The meeting emphasized that it is necessary to actively expand domestic demand, give full play to the basic role of consumption in driving economic growth, expand consumption by increasing residents’ income,” state news agency Xinhua reported.

“It is necessary to boost the consumption of automobiles, electronic products, and home furnishing, and promote the consumption of services such as sports, leisure, and cultural tourism,” said the report.

“The readout was fairly dovish, and so may give some hope to those wanting more policy support, but does not seem to signal much more significant stimulus incoming near-term,” an assessment of the economic meet-up from China watchers at Sinocism stated. 

Capital Economics analysts said that the outcome of the meeting suggested that further policy support would be rolled out in coming months.

“But the absence of any major announcements of policy specifics does suggest a lack of urgency or that policymakers are struggling to come up with suitable measures to shore up growth,” they said in a note.

China’s economy grew slower than expected in the second quarter as youth unemployment hit a record high, adding to the growing despondency among dry bulk owners who have had little to cheer in 2023 to date.

Gross domestic product (GDP) expanded by 0.8% during April-June compared with the previous quarter.

Previous stimulus measures, most notably after the global financial crisis, have been a strong help to the global dry bulk community. 

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