China Expands Consumer Subsidies to Boost Electronics Sales
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China is expanding its consumer subsidy program to include smartphones, tablets, and smartwatches, in a bid to revitalize sluggish consumer spending, according to a Friday announcement by the National Development and Reform Commission (NDRC), as reported by the Wall Street Journal.
The NDRC stated that the program, which currently incentivizes trade-in and upgrades for vehicles and home appliances, will be broadened to encompass electronics, safety products, and other goods.
Details of the expanded program are expected to be released shortly.
The announcement triggered a surge in Hong Kong-listed shares of Chinese smartphone and appliance companies. Xiaomi, a leading smartphone manufacturer, saw a 6.6% jump, making it the top performer on the benchmark index.
China initially introduced trade-in programs for home appliances and automobiles in 2024, effectively boosting auto demand, particularly in the final quarter.
Investors have been closely monitoring whether these initiatives would continue into 2025.
Beijing's use of trade-in programs to stimulate consumption is not new, with similar initiatives implemented in 2009 and 2010. This underscores the government's ongoing strategy to foster economic growth by targeting domestic demand.