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China's cabinet unveils steps to spur new forms of consumption

FILE PHOTO: People walk past a department store of the Wangfuijing Group in Beijing, China, June 10, 2020. REUTERS/Thomas Peter

BEIJING (Reuters) - China’s cabinet on Monday issued guidelines to boost new types of consumption, including online shopping and payments, in a bid to support the recovery of the economy.

New forms of consumption have played an important role in driving China’s economic recovery, but the development is hampered by inadequate infrastructure, weak service capacity and lagging regulations, the State Council said.

China’s retail sales rose 0.5% in August from a year earlier, snapping a seven-month downturn, but still trailing behind expansion in exports and investment, as the economy steadily recovers from a coronavirus-induced slump.

China aims to foster a batch of model cities and leading companies on new types of consumption by 2025 and the share of online retail sales in overall retail sales would show as significant increase, the cabinet said.

China would allow qualified firms in the new consumption sector to raise funds by issuing stocks and bonds, while banks will reduce fees for consumers and firms, the cabinet said.

The government will also promote the close integration of online and offline businesses, and improve infrastructure, including 5G networks and data centres, it said.

Reporting by Lusha Zhang and Kevin Yao; Editing by Alex Richardson

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