Beijing, December 24, 2024 (Xinhua) — China’s Ministry of Finance has pledged to ramp up fiscal spending and government bond issuance in 2025 as part of a broader strategy to enhance economic stability and stimulate growth.
In a speech delivered at the conclusion of a two-day national fiscal work conference on Tuesday, Finance Minister Lan Fo’an outlined the government’s commitment to adopting a more proactive fiscal policy in the coming year. This policy shift aims to ensure that fiscal measures are both powerful and effective in driving economic recovery.
The upcoming fiscal approach aligns with the broader economic strategy set forth at the recent Central Economic Work Conference, where policymakers confirmed plans to implement a “moderately loose” monetary policy in 2025. This shift marks a notable departure from the more cautious “prudent” policy stance maintained over the past 14 years.
The move comes as China faces a complex mix of domestic and international economic challenges, and seeks to maintain a steady and robust recovery in the face of these headwinds.
According to Minister Lan, the government plans to set a higher deficit-to-GDP ratio for 2025. This will be accompanied by an increase in fiscal spending, accelerated fund deployment, and a more strategic allocation of resources. A particular focus will be placed on enhancing people’s well-being, stimulating consumption, and sustaining economic growth.
The priorities outlined during the conference emphasize strengthening domestic demand, modernizing industrial systems, improving quality of life for citizens, and supporting urban-rural integration. Additionally, the government will focus on building an ecological civilization and promoting a high standard of opening up to the world.
Lan also underscored the importance of addressing risks in critical sectors, particularly by expanding transfer payments to local governments. Furthermore, the government will prioritize curbing the growth of “hidden debts” among local authorities and speeding up reforms aimed at transforming local government financing platforms.
With these initiatives, China aims to bolster economic resilience and ensure a balanced and sustainable recovery in 2025.
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