At a press conference on March 6 on the sidelines of the Third Session of the 14th National People's Congress, Chinese Finance Minister Lan Fo'an said that China will implement a more proactive fiscal policy, with more persistent and vigorous efforts in five key aspects to boost economic growth, promote stability and high-quality development in 2025.

Accordingly, this policy includes measures to increase the fiscal deficit ratio, increase spending and accelerate spending progress, arrange for larger-scale government bond issuance to support growth stability, further increase transfer payments to local governments, and step up financial support for important sectors and fields.

Chinese Finance Minister Lan Fo'an speaks at a press conference on the sidelines of the Third Session of the 14th National People's Congress in Beijing, China, March 6, 2020. - Source: CGTN

China has set a fiscal deficit target of 5.66 trillion yuan ($780 billion) this year, or about 4 percent of gross domestic product (GDP) — up 1.6 trillion yuan from last year. National public spending will rise 4.4 percent to a total of 29.7 trillion yuan. In addition, government bond issuance will be increased to 11.86 trillion yuan, while central-to-local transfer payments will rise to 10.34 trillion yuan.

According to Minister Lam Fo'an, the increased financial support will focus on key sectors such as education, social security and employment. Spending on science and technology will increase by 8.3% to surpass 1.2 trillion yuan, while the medical and housing sectors will receive significantly increased financial support.

In addition, the Chinese Minister of Finance said that in 2025, fiscal authorities at all levels will vigorously promote scientific fiscal management and budget reform, comprehensively deepen the reform of the fiscal and tax systems, effectively prevent and resolve local government debt risks, strengthen financial accounting supervision, and improve the efficiency of financial management.

Mr. Lam Phat An also emphasized that the Chinese government has enough reserve tools and policy space to deal with possible internal and external instability.