China asks officials to spend less on cigarettes, alcohol and travel; Here's why
China has instructed its officials once again to slash wasteful spends on travel, food as well office spaces, the official Xinhua News Agency said on Sunday.
As a the Bloomberg report quoting the Chinese news agency, the noticed issued by the government asks officials to specifically cut costs on alcohol and cigarettes.
The latest instructions, as per Bloomberg, comes as added signs of an austerity push by President Xi Jinping amid economic headwinds that strain government budgets.
The regulations also reinforce the ruling Communist Party's stance on officials having to reduce expenditure at a time when land sale revenues are declining, putting pressure on budget as local authorities stare at significant debts.
Chinese authorities in 2023 had asked its officials to embrace austerity measures, in a move to strengthen Jinping's drive to fight corruption.
The latest notice issued by the government for 'strict diligence and thrift, and opposes extravagance and waste,' as per the Chinese news agency. It reportedly added that 'waste is shameful and economy is glorious.'
Last year, Beijing kicked off its largest effort in years to address risks from local-authority debt, a move aimed at cutting default risks and giving local governments room to support economic growth.
A measure consumer staples stocks led was the biggest loser among the benchmark CSI 300 Index's sub-groups on Monday, slumping as much as 1.7 per cent, according to Bloomberg. Kweichow Moutai Co. retreated as much as 2.4 per cent, the most in six weeks.
Meanwhile, global investment banks are raising their forecasts for China's economic growth this year, after Beijing and Washington agreed to a 90-day pause on tariffs, despite uncertainty around Sino-US trade negotiations.
China's official target for full-year GDP is around 5.0 per cent. Citi has upgraded it to 4.7 per cent from 4.2 per cent, Goldman Sachs revised it to 4.6 per cent from 4.0 per cent and JP Morgan revised from 4.1 per cent to 4.8 per cent.
(With Bloomberg, Reuters inputs)
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