The slowdown in China’s formerly roaring economy has alarmed many who worry that a drop in its massive consumption and production will take the rest of the world down with it. However, the Chinese government isn’t sitting idly by and waiting for things to right themselves; neither are businesses that have had a taste of capitalism.

China’s authorities took a number of actions in July as they moved increasingly to battle obstacles to growth targets. It announced what it said would be a small stimulus, but nowhere on the scale of government measures in 2008 when a package amounting to 4 trillion yuan ($586 billion in 2008 dollars) was unleashed. This time around, Lou Jiwei, China’s finance minister, said in early July that “large-scale fiscal stimulus” measures were not an option; instead, the government planned to focus on increasing employment, keeping its debt level steady and making small adjustments to policies already in place.

While at the time he indicated that the government would allow the country to miss its growth target of 7.5%, official news agency Xinhua later changed its report to say instead that there was no doubt China could meet that target.

The People’s Bank of China (PBoC) has also eliminated the floor on lending rates offered by the country’s banks. It also indicated that it may act on deposit rates as well, to protect banks and help raise household incomes while steering people away from nontraditional wealth management products. The floor on mortgage rates, however, has been retained, lest speculation in the real estate market increase.

Lending had tightened up so much in June as the Chinese government tried to rein in property speculation that people began to move money from conventional savings into wealth management products (WMPs), which offer a considerably higher return than normal deposits. WMPs, despite being offered by banks, are considered a part of China’s shadow banking system—since approximately 70% of them do not guarantee principal.

Investors, for their part, are mostly unsophisticated bank depositors who do not understand WMPs’ risks and seem blissfully unaware that they could lose their money; in their minds, the WMPs are sold by banks, so they are safe. Meanwhile, while some WMPs invest in safer products like money markets, bonds, and deposits, many others instead seek out riskier options like derivatives, stocks, and loans to property developers and municipal governments.

With such high returns on offer, the banks rely on additional investors to help supply the cash to pay out to earlier investors—causing Xiao Gang, chairman of the China Securities Regulatory Commission, to characterize them as a Ponzi scheme. According to Fitch Ratings, the main ways the banks get the funds to pay for maturing WMPs are from—you guessed it, investors in new products—and from borrowing from the interbank market.

Investments in WMPs have surged to the point that the banks’ safety is in jeopardy. Should the market in WMPs go bust, bank reputations will suffer and, despite the fact that many of the products do not guarantee principal, the banks may be forced to pay investors anyway.

The government has also ordered an audit of government debt, which has already begun. The need for such an action was characterized as “urgent” by the National Audit Office, to the extent that other projects were suspended to give the audit process priority. Concerns over levels of local government debt and reliance on nontraditional credit sources have pushed the government to try to find out just how extensive the problem may be.

China is also cracking down on corruption, both foreign and domestic, with recent actions including its moves against pharmaceutical companies, hospitals and officials for price fixing and bribery; milk products contamination and price fixing; and price fixing among jewelers and foreign luxury car importers, with more crackdowns on the way.

In yet another government action, the fiscal deficit ratio to GDP has been capped at 3%, lest rating agencies decide to downgrade the country’s credit rating.

Although Markit Economics’ HSBC purchasing managers’ index fell to an 11-month low in July, indicating continued shrinkage in factory activity, the problem may be more intense at small companies than large ones; China’s official PMI for July, released the same day as the HSBC index, indicated that factory activity rose more than expected. The official PMI, produced by the National Bureau of Statistics, focuses on large and state-owned firms, while the HSBC index pays more attention to smaller companies.

Another revelation was an indication that services activity could be on the increase. The nonmanufacturing PMI, issued by the National Bureau of Statistics and China Federation of Logistics and Purchasing, showed faster growth than it has since March, which could be an indication that the Chinese economy is stabilizing.

There are other bright spots on the China horizon as well: the European Commission has brokered a settlement with China to lift antidumping duties on Chinese solar panels for Chinese companies that agree to participate. They must accept a minimum price for their wares and adhere to volume limits in exchange for having the 67% tariff lifted.

China’s richest man, meanwhile, apparently is not worrying about his country’s capacity for shopping, since he’s planning to open more malls in cities across the country preparatory to a planned IPO. Zong Qinghou, whose fortune has been estimated at $11.3 billion, doesn’t have a set date in mind for the IPO, but he does intend for his company, food and beverage conglomerate Hangzhou Wahaha Group Co., to have in the neighborhood of 100 malls within the next three to five years.

Zong has said that the malls would have to be profitable for three years running, at which point potential demand for stock would be evaluated before an IPO would be scheduled. But he has also said that the profit margins in his company’s department stores are better than those at manufacturing operations. He is also apparently considering expansion via working arrangements with Raffles of Singapore and Far Eastern Department Stores Co. of Taiwan.

And in a move that may surprise oenophiles, two top French winemakers have responded to accusations by Beijing of European wine dumping by working toward producing top grade wines in China, to be sold there and also to give China an entrée in to the rarified world of super-premium wines.

Domaines Barons de Rothschild (DBR), which owns such brands as Chateau Lafite, Chateau Duhart-Milon and Chateai L’Evangile, and luxury group LVMH Moet Hennessy Louis Vuitton SA’s Moet-Hennessy, known for brands such as Dom Perignon, Moet & Chandon and Chateau d’Yquem, are exploring the process of producing top-end red and sparkling wines in China. Each is investing with a Chinese partner, planting grapes and working toward an end product that will sell for hundreds of dollars a bottle.

China currently produces mostly low-end and midscale wines, with only a few producers of expensive vintages—but nothing on the scale planned by DBR and its Chinese partner, state investment firm CITIC, or Moet-Hennessey and its Chinese partner, winemaker VATS. DBR is planting in eastern Shandong province, and Moet-Hennessey has settled on a region adjoining Tibet that the Chinese government calls Shangri-La. Current Chinese-produced wines are considered far less desirable than even low-end imported wines, so this would be a major change for the industry.

China, according to a VINEXPO study, is the world’s fifth largest consumer of wine, with its consumption projected to grow at a rate of 54.3%—that’s a billion bottles a year—between 2011 and 2015. If that prediction holds, considering China’s burgeoning taste for luxury goods, it should be a match made in Shangri-La.