BEIJING — China is rolling out a mini-stimulus to fight its economic slump but is moving cautiously after its massive response to the 2008 global crisis left a painful hangover of inflation and debt.
Beijing has yet to announce a total price tag. But measures announced piecemeal in recent weeks include 66 billion yuan ($10 billion) to build affordable housing and 26.5 billion yuan to subsidize sales of energy-efficient appliances.
That limited size should make the effort more manageable than the 4 trillion yuan ($586 billion) avalanche of spending and bank loans in 2008. But its power to boost growth in a $2.5 trillion economy also will be smaller.
Still, analysts say the measures should be enough to drive a rebound and keep growth for the year at or slightly above 8 percent.
“I do think it will make a big difference,” said Nomura economist Zhiwei Zhang.
“Second-half GDP growth will be better than the first half, to a large extent driven by this support,” Zhang said. “Without it, I think growth probably would trend down.”
After spending two years enforcing lending and investment curbs to cool inflation and an overheated economy, communist leaders began gradually reversing course in December following a plunge in demand for China’s exports.
Their efforts took on more urgency after economic growth plunged to a nearly three-year low of 8.1 percent in the first quarter and factory output in April grew at its lowest rate since the 2008 crisis. Analysts say growth should slow more.
The Cabinet publicly confirmed its strategic shift last week, promising to “give more priority to growth.”
The impact should start to show up in stronger growth in August or September, according to Standard Chartered economists Stephen Green, Li Wei and Lan Shen.
The Cabinet said it approved plans to launch 20 “major projects” for seven emerging industries but gave no details of what support they might receive. Previous technology development efforts have included subsidies, tax breaks and other support that trading partners including the U.S. complained violated free-trade principles.