China Plans Targeted Fiscal Package to Boost Economic Growth

(ECNS) -- In a recent press conference, China's Minister of Finance, Lan Fo'an, announced the government's intention to implement a series of targeted fiscal measures aimed at stabilizing growth, boosting domestic demand, and mitigating economic risks.

Introducing Targeted Fiscal Measures

The upcoming fiscal package will consist of various key initiatives. One major component is an increase in the debt ceiling for local governments. This significant change aims to replace existing hidden debts and help mitigate the debt-related risks that local governments face.

Support for Banking and Credit

Additionally, the package will include the issuance of special treasury bonds. These bonds are designed to aid state-owned large commercial banks in replenishing their core Tier 1 capital. By enhancing the banks' financial strength, the government aims to improve their ability to withstand risks and increase credit supply in the economy.

Stabilizing the Real Estate Market

Moreover, the fiscal measures will use various tools, including special local government bonds, unique funds, and adjustments in tax policies, to stabilize the real estate market. This approach seeks to prevent any further declines in the housing sector, which is a crucial part of China's economy.

Support for Key Groups

Minister Lan highlighted that the government would also intensify its support for essential groups within society. Prior to the National Day celebration, one-time living allowances were distributed to disadvantaged individuals. Moving forward, the government plans to boost overall consumption by providing awards and additional aid to students.

Flexible Policy Adjustments

Lan noted that the four proposed policy measures are already in the decision-making process, but further adjustments may be considered. The central government still has considerable room to borrow and increase the deficit, which could lead to additional fiscal strategies in the future.

China, Fiscal, Economy