China has approved a massive $1.4 trillion economic stimulus package in response to Trump's victory in the US election. Beijing has decided to step up support for the economy amid expectations of an escalation of trade and technological confrontation on the part of the new American president. The preparation of these measures became known back in October, but now they have received official approval. The incentive package is aimed at indirect support measures: there is no direct increase in consumer demand, which may cause disappointment among investors. Nevertheless, there is some positive news. The Chinese authorities are considering the possibility of recapitalizing banks, buying out excess housing and switching to direct demand stimulation, which may have a more tangible impact on the economy. Trump has already made it clear that he intends to increase trade pressure on China, which could reduce China's GDP by several percentage points. The country remains vulnerable against the backdrop of a protracted crisis in the real estate sector, which makes the need for economic measures especially urgent.
