CCG (Center for China and Globalization) James Jianzhang Liang proposes Beijing invest 10 trillion in birth stimulus Chairman of Trip.com highlights an economy that hinges more than anything on births. Yuxuan JIA and Andy Han Nov 23

 CCG (Center for China and Globalization)

James Jianzhang Liang proposes Beijing invest 10 trillion in birth stimulus

Chairman of Trip.com highlights an economy that hinges more than anything on births.

Yuxuan JIA and Andy Han

Nov 23

 

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The notion "10-trillion yuan stimulus" already made its debut before Beijing's major economic policy shift in late September, sparking widespread discussion. On September 21, Liu Shijin, Former Vice President (Vice Minister) of the Development Research Centre (DRC), a comprehensive policy research and consulting institution directly under the State Council, proposed a stimulus package of no less than 10 trillion yuan, financed through ultra-long-term special treasury bonds over one to two years.

Soon, the "10-trillion yuan stimulus" proposal was picked up and expanded upon by other economists.

Teng Tai, Head of the WANB Institute and the chief economist at China Galaxy Securities and Minsheng Securities published an article two days after Liu's proposal, fully endorsing the necessity of the 10-trillion-yuan economic stimulus plan and advocating for a focus on consumption subsidies rather than further investment expansion.

In an interview published on October 1, Jia Kang, former Director-General of the Institute for Fiscal Science (now Chinese Academy of Fiscal Sciences), the finance ministry's in-house think tank, also echoed the urgency for stimulus measures, saying, "Scaling up the bond issuance to 4 trillion or even 10 trillion yuan would not be excessive."

According to the South China Morning Post report on October 18, Liu Shangxi, former Director-General of the Chinese Academy of Fiscal Sciences and Jia Kang's successor, proposed that the combined value of stimulus "should absolutely surpass" 10 trillion yuan.

More recently on November 8, speaking at the 15th Caixin Summit organized by Caixin Media and Caixin Think Tank in Beijing, James Jianzhang Liang, Co-founder and Chairman of Trip.com Group and a public intellectual on China's birth policies, called for Beijing to invest the much-heralded 10 trillion yuan in pro-birth initiatives.

Liang presented his speech just hours before the Chinese government announced a 12 trillion yuan stimulus package, albeit mostly targeted at local government debts.

Liang identifies population decline as the root cause of China's economic challenges, linking it to insufficient domestic demand, deflation, and reduced long-term economic dynamism. He attributes China's low birth rates to have children to a disproportionate burden of child-rearing costs and time placed solely on families, while society at large reaps the benefits, creating a mismatch that stifles population growth. Therefore, Liang proposes that China invest 10 trillion yuan in subsidies, tax cuts and exemptions, expanded childcare services, and educational reforms. These measures would "kill two birds with one stone," said Liang, simultaneously stimulating demand and securing China's economic future.

The video recording of Liang's speech is available on the Caixin Summit's website. A transcript was initially posted on Rao Liang Shuo 绕梁说, Liang's personal WeChat blog, but it is now unavailable due to a "content regulation violation," although other reposts remain accessible on the Chinese internet.

Liang has been frequently featured in The East is Read and Pekingnology.

—Yuxuan Jia