China's fiscal deficit to hit record high in 2009
Tuesday, 24 February 2009
BEIJING, Feb 23 (AFP): China's fiscal deficit is set to hit a record high this year, as the global crisis shrinks revenues while forcing the government to spend more on pump- priming, local media said.
The finance ministry has foreseen a deficit of 950 billion yuan (139 billion dollars) in its draft budget for 2009, the China Business newspaper reported over the weekend.
The figure is nine times higher than a deficit of 111 billion yuan in 2008, and it accounts for about three per cent of the overall economy, which is an internationally recognised alarm level, the paper said.
China Business said the deficit will result from fiscal spending in 2009 topping 7.6 trillion yuan, up 22.1 per cent from 2008, as the government plans to raise investment in 15 sectors including housing and transportation.
Meanwhile, the finance ministry forecasts fiscal revenue to reach 6.6 trillion yuan this year, as the growth rate is expected to slow sharply from last year's 19.5 per cent to eight per cent this year.
China unveiled a massive four-trillion-yuan spending programme in late 2008 to revive the economy and this year has issued or is expected to soon introduce more incentives for 10 sectors such as autos and petrochemicals.
The finance ministry has foreseen a deficit of 950 billion yuan (139 billion dollars) in its draft budget for 2009, the China Business newspaper reported over the weekend.
The figure is nine times higher than a deficit of 111 billion yuan in 2008, and it accounts for about three per cent of the overall economy, which is an internationally recognised alarm level, the paper said.
China Business said the deficit will result from fiscal spending in 2009 topping 7.6 trillion yuan, up 22.1 per cent from 2008, as the government plans to raise investment in 15 sectors including housing and transportation.
Meanwhile, the finance ministry forecasts fiscal revenue to reach 6.6 trillion yuan this year, as the growth rate is expected to slow sharply from last year's 19.5 per cent to eight per cent this year.
China unveiled a massive four-trillion-yuan spending programme in late 2008 to revive the economy and this year has issued or is expected to soon introduce more incentives for 10 sectors such as autos and petrochemicals.