An article by President Xi Jinping published in this year's 24th issue of the Qiushi Journal highlights how important it is for China to expand domestic demand in order to make its economic development more sustainable and more resilient.

The article makes it clear that rather than being a stopgap, expanding domestic demand is a strategic measure that is necessary to maintain the long-term, sustained, healthy development of China's economy and meet people's ever-growing demand for a better life.

Pointing to insufficient aggregate demand as a prominent issue for the country's economic development at present, the article rightly stresses the need for coordinated efforts to boost both supply and demand, with the goal of achieving an optimal dynamic equilibrium where demand propels supply and supply in turn generates demand.

Consumption is already cementing its role as the primary economic driver. Final consumption expenditure contributed 53.5 percent to economic growth in the first three quarters of 2025, up 9 percentage points from the full-year figure of the previous year, data from the National Bureau of Statistics show. Retail sales of consumer goods — totaling 45.61 trillion yuan ($6.45 trillion) — were up 4 percent year-on-year in the same period.

The central authorities have prioritized increasing consumption as a driver of growth over the next five years and have recognized the importance of reorienting the economy from goods to services. To that end, policymakers have already taken steps.

The Ministry of Commerce, the People's Bank of China, and the National Financial Regulatory Administration jointly made public a circular on Sunday urging stronger coordination between the commerce and financial sectors to step up support for consumption. The document outlines measures to guide financial institutions in focusing their support on key consumption areas and facilitating the expansion of domestic demand. In particular, it calls for establishing sound coordination mechanisms between local commerce and financial authorities, and encourages local governments to utilize various policy tools, such as financing guarantees and loan interest subsidies, to guide credit funds toward critical consumption sectors. That means the local pro-consumption measures will become more diversified to suit regional conditions.

In the services sector, the policy stresses innovation in financial products for industries such as elderly care, catering, tourism and education. It encourages the cultivation of new consumption models, including the "debut economy", green consumption, and digital scenarios, while promoting the application of artificial intelligence in driving consumption.

It is noteworthy that the circular pledges more financial support for the "Shopping in China" campaign and the development of international consumption center cities. It correctly highlights the importance of further improving payment convenience for visitors from overseas so as to effectively promote inbound consumption.

All these measures are in line with the demands of the Central Economic Work Conference, which emphasized that the country will implement more proactive and impactful macroeconomic policies, formulate more far-sighted, more targeted and better-coordinated policies, continuously expand domestic demand and optimize supply, and develop new quality productive forces according to local conditions.

To fully tap the economic potential, policy support and reform and innovation will be pursued to ensure market vitality and effective regulation. Investment in physical assets will be combined with investment in human capital to strengthen internal capabilities.

It should be clarified that China's endeavors to expand domestic demand are not in conflict with opening the country wider. The greater domestic demand is, the more appealing the Chinese market will be to foreign investment.

With its superlarge domestic market and institutional advantages, China has the potential to further boost domestic demand to make it a major driver of sustainable growth. And expanding domestic demand is the key to the upgrading, transformation and sustainable growth of the Chinese economy in the challenging times.