China can expand domestic demand through various policies including rebates for swapping old vehicles, appliances and factory equipment for new ones, Zhao said, forecasting that demand for equipment upgrades will exceed 5 trillion yuan ($34.8 billion) a year.

Chinese policymakers on Monday sought to assuage concerns the broad U.S. tariffs could derail efforts to shore up a fragile economic recovery, even as analysts warn the hefty levies raise the risk of a sharp downturn in growth.

President Donald Trump’s unprecedented tariffs, particularly on China, and recent attacks on Federal Reserve Chair Jerome Powell caused alarm among some of his top advisers and America’s biggest CEOs, who warned of financial chaos and store shelves that could go bare, people familiar with the conversations said.