投资者陈述 - 中国经济叙事转变 VS 现实检验-Investor Presentation-China Economics Narrative Shift vs. Reality Check

Summary of Key Points from the Conference Call Industry Overview - Industry: China Economics and Market Dynamics - Company: Morgan Stanley Asia Limited Core Insights and Arguments 1. Economic Growth Projections: Real GDP growth is expected to reach 4.8% in 2025, with a slowdown anticipated in the second half of the year, alongside persistent deflation trends [2][10][15] 2. Export Weakness: Exports are projected to weaken in the second half of 2025 due to payback from front-loading and weaker global trade, exacerbated by higher US tariffs on global trade partners [6][8] 3. Fiscal Stimulus Decline: Fiscal stimulus has been front-loaded to the first half of 2025, with a reduced fiscal impulse expected from August onwards [10][11] 4. Deflation Feedback Loop: A continued deflation feedback loop is observed, with weaker nominal GDP negatively impacting wage growth [15][16] 5. Housing Market Concerns: Housing investment has largely completed its adjustment, but the outlook for housing prices remains uncertain, indicating potential risks in the real estate sector [20][22] 6. Market Sentiment Factors: Market sentiment is supported by liquidity, with significant inflows from major institutions and retail investors into the A-share market in the first half of 2025, estimated at approximately RMB 1.5-1.7 trillion [25][27] 7. Narrative Shift: A more constructive narrative is forming around China’s economic policies, with a pivot towards addressing social dynamics and anti-involution measures [37][39] 8. Household Savings Reallocation: There is potential for RMB 6-7 trillion in household savings to be reallocated towards riskier investments, contingent on improved risk appetite and macroeconomic fundamentals [42][46] 9. AI and Tech Sector Growth: The tech sector, particularly AI, is expected to see significant growth, with policy support and increased capital expenditure in emerging sectors [62][64][72] 10. Reflation Strategy: A "5R" reflation strategy is being implemented, focusing on rebalancing the economy through fiscal measures, social welfare reforms, and structural adjustments [135][136] Additional Important Insights - Inflation and Price Dynamics: The potential for deflation to persist into 2026 is highlighted, with various scenarios outlined from worst-case to ideal outcomes [104][105] - Sector-Specific Implications: Different sectors are experiencing varying levels of urgency and potential for anti-involution measures, with specific action plans and challenges identified for sectors like EV batteries, cement, and airlines [131][134] - Social Welfare Reforms: Emphasis on social welfare reforms as a key component for economic rebalancing, including subsidies for families and education [143][140] This summary encapsulates the critical insights and projections discussed during the conference call, providing a comprehensive overview of the current economic landscape and future expectations for China.