China pledges appropriate fiscal expansion to support economic growth

To assist the country’s crucial strategic development, China promised to increase fiscal spending “appropriately” next year while “optimizing” policy instruments like the budget deficit and particular debt.

Following a statement Thursday posted on the website of the Ministry of Finance, government investment would play a more significant role in driving private investment, promoting consumption, and stabilizing international trade and investment.

Citing the minutes of a nationwide virtual meeting of financial experts presided over by minister Liu Kun, it stated that proactive fiscal policy “should be enhanced in 2023 to boost its efficiency and play a more direct and effective contribution.”

It stated without further explanation that tax help would either be increased or improved the following year to give businesses more relief.

During the first three quarters of this year, China’s overall fiscal deficit reached a record high as COVID outbreaks and a downturn in the property market further reduced government revenue. As a means of boosting its economic performance, the nation may need to set a budget deficit target of above 3% of GDP for the upcoming fiscal year, according to former finance minister Lou Jiwei.