China retains vast potential in services spending: expert

China's economy has maintained steady momentum, but pressures from a still-weak domestic demand remain pronounced, reinforcing calls from a top expert for coordinated efforts in opening-up and innovation to prioritize domestic demand, with a focus on unlocking the potential of services consumption.

"As the world's second-largest consumer market, China retains vast growth potential and ample room for further expansion," said Zhang Jianping, deputy director of the academic committee at the Chinese Academy of International Trade and Economic Cooperation.

Zhang made the remarks at a press event organized by the All-China Journalists Association in Beijing on Thursday, adding that although consumer spending has dropped in the short-term, both goods and services markets continue to generate new growth pockets.

"Services spending in particular has seen multiple areas of strength, notably in cultural tourism, information services, education and training, and healthcare," Zhang said.

"Growth in services has consistently outpaced that of goods consumption."

He added that services spending still accounts for a relatively small share of overall spending, leaving substantial headroom for growth that is expected to help power a broader expansion of domestic demand.

Turning to goods consumption, Zhang said new growth momentum is building in smart, connected home appliances, electric vehicles and intelligent connected vehicles, which are emerging as fresh drivers of consumer demand.

That momentum has been reinforced by recent policy support. The National Development and Reform Commission and the Ministry of Finance recently rolled out a renewed consumer goods trade-in program, expanding subsidy coverage to include a broader range of smart products, such as artificial intelligence glasses and intelligent home products.

"As pro-consumption policies continue to gain traction, more supportive measures are likely to be unveiled at the two sessions — the annual meetings of China's top legislature and political advisory body — to further unlock consumption's potential as a growth driver," Zhang added.