BEIJING, Dec 30 (Reuters) – China is front-loading 62.5 billion yuan ($8.94 billion) from ultra-long special treasury bond funds to support its 2026 programme offering consumers subsidies to replace domestic appliances, state news agency Xinhua reported on Tuesday.
The plan was confirmed by the country’s top economic planner on Wednesday, which also vowed to crack down on fraud and other illegal activities related to the scheme.
Li Chao, a spokesperson of the National Development and Reform Commission (NDRC), told a news conference the first batch of treasury bond funds for the 2026 consumer goods trade‑in programme has already been allocated to local governments to help meet consumption demand during the New Year and Spring Festival holidays.
Beijing launched the scheme in 2024, providing financial support when consumers replace old appliances, bicycles and even cars, in a bid to shore up domestic demand amid persistent economic and trade pressures at home and abroad.
In 2026, digital and smart products will be included in the scheme with smartphones, tablets, smartwatches and smart wristbands qualifying for a 15% rebate, capped at 500 yuan each, the state planner and finance ministry said in a separate statement.
The Xinhua report did not specify the total size of the fund for the 2026 scheme. China set aside 300 billion yuan in special treasury bonds this year, released in batches throughout the year.
China has routinely allowed local governments to issue bonds ahead of the annual parliamentary session, which approves the government’s budget plans and is typically held in March.
Under the scheme, consumers purchasing any of six categories of major home appliances, including refrigerators, washing machines, TVs, are eligible for a 15% subsidy of up to 1,500 yuan per item.
Buyers scrapping old cars receive subsidies equal to 12% of the purchase price of new energy vehicles, capped at 20,000 yuan, while those replacing older vehicles with new NEVs get 8%, up to 15,000 yuan.
China’s economy stalled in November, with the slowest growth in factory output in 15 months and the weakest retail sales since the end of zero‑COVID curbs, underscoring the urgent need for new growth drivers heading into 2026.
China will launch special campaigns targeting illegal practices such as fraudulent subsidy claims, fabricated transactions and “raising prices before offering subsidies,” Li from the state planner said.“Any violations discovered will be investigated, punished and publicly exposed without delay,” Li added.
Auditors have uncovered problems linked to the treasury‑bond‑funded stimulus in 2024 — including the consumer goods trade‑in scheme and a separate upgrade initiative — involving a total of 10.335 billion yuan, state media reported earlier this month.
Chinese leaders have pledged to “significantly” increase the share of household consumption in the economy over the next five years. Household consumption accounts for about 40% of GDP, far below nearly 70% in the United States.
Some government advisers say Beijing should expand policy support for services consumption and aim to lift the consumption rate to about 45% over the next five years.
China will also expand the equipment‑upgrade programme beyond existing sectors such as industry, energy, power, transport, logistics and healthcare to include elevators in old residential blocks, elderly‑care facilities and fire‑and‑rescue systems, according to the state planner and finance ministry’s statement.
($1 = 6.9885 Chinese yuan)
(Reporting by Shi Bu and Kevin Yao; Editing by Kirsten Donovan and Susan Fenton)
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