China doubles down on manufacturing, leaving real estate behind

China announced plans to allocate 10.4 billion yuan ($1.45 billion) to support the manufacturing sector and promote high-quality development. The funds aim to rebuild industrial foundations and enhance competitiveness. Unlike other economies, China’s investment rate is not falling. Instead, capital expenditure is shifting towards infrastructure and manufacturing, which cushions the impact of the deflating property market on growth. However, the shift carries the risk of overinvestment if demand does not keep up. The finance ministry’s report prioritizes supporting the industrial system’s modernization and the implementation of the strategy of invigorating China through science and education. The real estate sector was not mentioned in the plans. Tech and industrial development received more attention, reflecting China’s focus on becoming a leader in electric cars.