On January 5, 2025, the National Development and Reform Commission and the Ministry of Finance jointly issued the “Notice on Strengthening and Expanding the Implementation of Large-Scale Equipment Upgrading and Consumer Goods Trade-in Polices in 2025“. The overall considerations for the intensified and expanded implementation of the “Two New” policies in 2025 are to increase the scale of funding, expand the scope of support, optimize the implementation mechanisms, and amplify the leverage effect. This is based on the implementation of the national “Two New” policy of  “Action Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in” (State Council Document No. 7 [2024]).

The notice specifies the following policies:

1. Equipment Upgrading Policy

• Increase financial support: expand the scale of ultra-long-term special government bonds to support equipment upgrading in key areas such as industry, energy, power, and transportation. New areas such as electronic information, work safety, and facility agriculture will also be included.
• Implement loan interest subsidies: in additional to the central government financial interest subsidies, the National Development and Reform Commission will arrange additional interest subsidies to reduce corporate financing costs.
• Accelerate the assessment of existing equipment: conduct the comprehensive assessment and diagnosis of existing equipment in various fields to clarify the tasks and plans for upgrading.
• Support the scrapping and renewal of old ships and vehicles: improve subsidy policies and expand the scope of subsidies to promote the scrapping and upgrading of old operating trucks, agricultural machinery, and other vehicles.

2. Consumer Goods Trade-in Policy

• Optimize fund allocation: Continue to allocate ultra-long-term special government bond funds to localities to support the trade-in of consumer goods, with a focus on wholesale durable goods.
• Expand the scope of vehicle scrapping and upgrading: Include fuel passenger vehicles that meet the National IV emission standards in the subsidy scope and increase the subsidy standards for new energy passenger vehicles.
• Support the trade-in of home appliances: Include four types of home appliances, such as microwave ovens and water purifiers, in the subsidy scope and raise the subsidy standards.
• Implement subsidies for purchasing new digital products: Provide subsidies for purchasing new digital products such as mobile phones and tablets.
• Support the upgrading of home decoration consumer goods: Increase subsidies for the renovation of old houses and kitchen and bathroom renovations to promote smart home consumption.

3. Additional Measures

• Strengthen capacity building: support the construction of high-level recycling and circular utilization projects, promote the integration of the two networks, and cultivate backbone enterprises.
• Promote the transaction of second-hand goods: promote the pilot construction of second-hand goods circulation, support the export of second-hand vehicles, and encourage the upgrading of the remanufacturing industry.
• Support the recycling of waste electrical and electronic products: the central government will continue to arrange special funds to support the recycling and treatment work.
• Accelerate the formulation and revision of standards: improve the requirements for technical, energy consumption, and emission indicators in key industries and equipment, and formulate energy efficiency or water efficiency standards in the fields of smart home and digital products.
• Strengthen the supervision of standard implementation: Improve the quality supervision and random inspection system and strictly implement mandatory standards.

These policies aim to further promote economic development, strengthen domestic demand potential, and promote industrial upgrading and green transformation in China.