The picture shows a residential complex built in Hangzhou, China on December 16, 2024.
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Beijing – China announced on Wednesday that it plans to raise its fiscal deficit to “about 4%” of GDP, a rare increase, marking a meaningful shift in policy.
The target was confirmed in an official government report in Parliament on Wednesday.
The new deficit plan is growing 3% from last year as the trade war with U.S. President Donald Trump’s administration escalates.
There is a general expectation to increase to 4% of GDP. According to data accessed through wind information, it marks a record back to the highest fiscal deficit in 2010. Data shows that in 2020, the previous high was 3.6%.
In October, Chinese Finance Minister Lang Fu’an said that the room for increasing the deficit is “Quite large. ”
China announced support package in November 10 trillion yuan (US$1.4 trillion) in five years – Mainly to solve Local government debt issues.
The country’s downturn in real estate market has become an important source of income for local governments, many of which Financial struggle Even before Need to spend on Covid-19 measures. At the same time, insufficient consumption and slow overall growth are multiplied by the call More financial stimulus.
According to Macquarie’s Charry larryhu, China’s special sovereign bond sales are expected to account for 3 trillion yuan (US$410 billion) from 1 trillion yuan in 2024, and increase the quota for local government issuance of special local government bonds to 4.5 trillion yuan, according to Macquarie’s Chiren Chiner Charry Hu, according to Macquarie’s Chiren Chiner Charry Hu, according to Macquarie’s Chiren Chiner Charry Hu, and the sales of special sovereign bonds in China are expected to account for 3 trillion yuan (US$410 billion) from 2024, and increase the quota for local government issuance of special government bonds to 4.5 trillion yuan, from the previous estimate of 390 million yuan.
