China pledges support for private market, no stimulus plans

BEIJING — China’s leaders affirmed support Thursday for private business within its state-dominated economy but gave no sign of initiatives to boost sagging growth following a planning meeting.

The annual gathering of the Communist Party’s Central Committee came as companies and investors are watching for interest rates cuts or other steps to shore up China’s weakest economy in nearly three decades.

Exporters have been battered by President Donald Trump’s tariff hikes on Chinese imports in a fight over Beijing’s trade surplus and technology ambitions but the overall economic impact is limited. Analysts say the slowdown is due mostly to weak domestic demand from Chinese consumers and companies.

A party statement said state-owned industry is the “main body” of the economy. But it promised to “unswervingly support” entrepreneurs. It also affirmed a promise first made in 2013 to give market forces the “decisive role” in allocating resources.

The economy was mentioned in four brief sentences in the 23-paragraph statement, which was devoted mostly to political issues.

After more than four decades of market-oriented reforms of the planned economy that was imposed after the 1949 communist revolution, China’s industries are still state-dominated.

The government of President Xi Jinping has promised repeatedly to help entrepreneurs who generate most of China’s new jobs and wealth. But reformers complain Beijing is doing too little while also building up government companies that dominate swathes of the economy.

Economic growth slowed to 6% over a year earlier in the three months ending in September, its lowest quarterly level since at least 1993.

Earlier Thursday, an industry group reported that China’s factory activity shrank more sharply than expected in October.

The monthly purchasing managers’ index of the China Federation of Logistics & Purchasing declined to 49.3 from September’s 49.8 on a 100-point scale. Numbers below 50 show activity contracting.

The latest data suggest improved activity at the end of the previous quarter “didn’t mark the start of a sustained recovery,” Julian Evans-Pritchard of Capital Economics said in a report.

Sales of Chinese goods to the U.S. market fell almost 11% from a year earlier in the first nine months of this year. But global exports are off only 0.1% in the same period due to stronger sales to developing markets.

Joe McDonald, The Associated Press