Reflections on Growth-Stabilization Policies in the Current Environment

Abstract: To counter economic headwinds and achieve stable growth, a coordinated approach is needed across three dimensions: macroeconomic policy, industrial policy, and structural reform. Macroeconomic policy should primarily serve short-term counter-cyclical needs and not become a long-term dependency. Industrial policy must address structural challenges during the transition and upgrading of key sectors—for example, balancing the stabilization of critical industries like real estate with the cultivation of emerging sectors. Reform policies should focus on improving the business environment for private enterprises and enhancing the efficiency of market-based resource allocation.

The economic impact of U.S. tariff increases may exceed expectations, underscoring the need for preparedness against potential downside risks in the period ahead and for more targeted policy interventions. This includes providing direct relief to affected businesses and individuals to help them navigate near-term difficulties, as well as expanding domestic demand—particularly consumption. Enhancing social security for groups such as urban migrant workers can increase their purchasing power, potentially delivering immediate and meaningful support for growth stabilization.