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China is facing increasing calls, both domestically and internationally, to stimulate its economy. Economists inside China suggest the country should take more significant steps, such as issuing over 10 trillion yuan ($1.42 trillion) in government bonds within the next two years. These funds could be used to invest in areas like human capital and drive economic growth.

Liu Shijin, a former official from China's top executive body, presented an idea at a recent economic forum that the country should expand its efforts to help migrant workers and address other challenges. According to Liu, China should avoid the usual methods of cutting interest rates that many developed countries use, as its economic slowdown is not at that point yet.

Despite hopes of an economic rebound after the pandemic, China's growth has remained sluggish, mainly due to ongoing issues in the real estate sector and weakened consumer confidence. Manufacturing growth has slowed, but exports have shown some resilience.

Investment banks like Goldman Sachs have already cut their expectations for China's economic growth this year, lowering their forecast from 4.9% to 4.7%. This adjustment reflects recent data showing weaker growth and a slower-than-expected impact of China's fiscal policies. Many analysts worry that China might miss its annual target of around 5% GDP growth unless more steps are taken to stimulate demand.

China's government has introduced various measures, such as offering subsidies for purchasing large equipment like elevators, to encourage spending, but these actions haven't had a significant impact. Retail sales in August grew by just 2.1% compared to the previous year, one of the slowest growth rates since the pandemic recovery.

The real estate market remains a significant problem for China's economy. Despite efforts to support the sector, property investments are still down over 10% for the first eight months of the year. With millions of pre-sold housing units still unfinished, many buyers are hesitant to invest in property, fearing that their homes won't be completed. The lack of progress in stabilizing the housing market continues to be a drag on China's overall growth.

China's leadership, meanwhile, has shifted its focus to advanced manufacturing and technology, especially given the increasing restrictions from the United States on high-tech exports. Although China's policymakers signaled a willingness to step up stimulus measures earlier in the year, their actions have been modest. They seem to be aiming to reach the 5% growth target, even if it means a combination of lower actual growth with some inflationary pressures.

Local governments in China also face financial constraints, with tighter fiscal conditions limiting their ability to invest in infrastructure projects. Analysts believe that conventional monetary policies have reached their limits, and there is a growing call for the Chinese government to take a more active role in stabilizing the property market and supporting the economy through direct funding.

China's economy officially grew by 5% in the first half of the year, and exports saw an 8.7% increase in August. However, the central government acknowledges the need to stay focused on achieving its full-year growth goal of around 5% in 2024. The emphasis remains on balancing short-term measures with long-term economic reforms to ensure consistent growth over the next decade.