Core Viewpoint - The current consumption shortfall in China is a structural deviation that requires investment policies and funding to stimulate consumption and create new momentum for stable growth and transformation [2][3][4]. Consumption Shortfall - China's economic recovery faces severe challenges due to insufficient demand, primarily stemming from low consumption rather than investment [3]. - The consumption rate in China is comparatively low, indicating a structural deviation, particularly in service consumption related to education, healthcare, housing, social security, and elderly care [3][4]. - The largest gap in consumption is found among rural residents, especially among nearly 300 million migrant workers and 200 million rural workers who have moved to cities [3][4]. Concept of "Terminal Demand" - The concept of "terminal demand" combines consumption and non-productive investment, focusing on real estate and infrastructure related to people's livelihoods [4]. - Historical rapid growth in real estate and infrastructure has led to overextension, contributing to current economic challenges such as low prices and nominal growth below actual growth [4][5]. Policy Recommendations - Investment policies should focus on stimulating consumption to address the low consumption ratio, aiming to raise the consumption share of GDP to a reasonable level as a hard task for stable growth [8][9]. - Structural reforms should target low-income groups to enhance their consumption capacity, particularly in essential service sectors [9][10]. Structural Reforms - Three key areas for structural reform include: 1. Addressing housing shortages for migrant workers by allowing local governments to use special bonds to acquire unsold housing for affordable housing projects [10]. 2. Reforming the pension system to ensure coverage for all residents, aiming to gradually increase pension income to 1,000 yuan/month over five years [11][12]. 3. Promoting a second wave of urbanization by facilitating the smooth flow of production factors between urban and rural areas, targeting the development of small and medium-sized towns [13].

Core Viewpoint - The article emphasizes the need for structural reforms to address the issue of insufficient consumption in China, which is seen as a structural deviation rather than a lack of investment [3][4][6]. Group 1: Consumption Insufficiency - China's economic growth faces severe challenges due to insufficient demand, primarily stemming from low consumption rather than low investment [3]. - The consumption gap is particularly pronounced in service sectors such as education, healthcare, and social security, with rural residents, especially migrant workers, being the most affected [3][4]. - The article highlights the importance of addressing the urban-rural dual structure to improve consumption levels [4][6]. Group 2: Structural Reforms - The concept of "terminal demand" is introduced, which combines consumption and non-productive investment, particularly in housing and infrastructure related to people's livelihoods [4]. - The article suggests that stimulating policies should focus on increasing consumption's share of GDP as a "hard task" for stable growth [6][8]. - Three key areas for structural reform are proposed: housing for migrant workers, pension system reform, and promoting urbanization in smaller towns [9][10][12]. Group 3: Housing and Pension Reforms - The first reform focuses on addressing the structural inadequacies in housing for new urban residents, suggesting local governments use special bonds to acquire unsold housing for social housing projects [9]. - The second reform aims to enhance the pension system by reallocating state-owned capital to social security funds and improving the long-term contribution system [10][11]. - The third reform encourages the smooth flow of production factors between urban and rural areas to drive a new wave of urbanization, targeting a 75% urbanization rate within ten years [12].

Core Viewpoint - The current consumption shortfall in China is a structural deviation that requires investment policies and funding to stimulate consumption and promote stable growth and transformation [3][4]. Group 1: Consumption Shortfall - China's economic growth faces severe challenges due to insufficient demand, primarily stemming from low consumption rather than investment [3]. - The consumption rate in China is comparatively low, particularly in service consumption related to education, healthcare, housing, social security, and elderly care [3][5]. - The largest gap in consumption is found among rural residents, especially among nearly 300 million migrant workers [3][5]. Group 2: Structural Reforms - To address the consumption shortfall, a focus on "terminal demand," which includes consumption and non-productive investment, is essential [3][5]. - The need for structural reforms is emphasized, particularly in improving public services and increasing income for low-income groups [7][8]. - Three key areas for structural reform include housing for migrant workers, pension system reform, and facilitating the flow of production factors to drive urbanization [9][10][11]. Group 3: Policy Recommendations - Investment policies should be directed towards enhancing consumption, with a goal to raise the consumption-to-GDP ratio to a reasonable level [7][8]. - The housing market requires adjustments to address structural mismatches, allowing local governments to utilize special bonds for affordable housing projects [9]. - The pension system needs reform to cover more residents and gradually increase pension income to 1,000 yuan/month over five years [10].