Minister of Finance Lan Fo'an introduced that around stabilizing growth, expanding domestic demand, and reducing risks, the Ministry of Finance will gradually introduce a package of targeted incremental policy measures in the near future. Mainly include several aspects:

First, increase support for local governments to resolve government debt risks, significantly increase debt limits, support localities in resolving hidden debts, so that local governments can free up more financial space to promote development and ensure people's livelihoods.

Second, issue special national bonds to support large state-owned commercial banks in supplementing core Tier 1 capital, enhance the ability of these banks to resist risks and credit allocation, and better serve the development of the real economy.

Third, use local government special bonds, special funds, tax policies, and other tools to support the stabilization of the real estate market.

Fourth, increase support and guarantee for key groups. Before the National Day, one-time living allowances had been distributed to needy groups, and the next step will increase rewards and assistance for student groups, enhancing overall consumer spending power.

In 2023, the scale of general public budget expenditures for the whole year reached 28.55 trillion yuan, maintaining a high level of expenditure intensity, providing strong support for high-quality development.

Since this year, the fiscal department has adhered to an active fiscal policy, appropriately increased efforts, improved quality, actively expanded domestic effective demand, issued 3.6 trillion yuan of new special bonds from January to September, supported over 30,000 projects, and used project capital exceeding 260 billion yuan.

In 2024, the central finance will arrange for local transfer payments to exceed 10 trillion yuan, using more funds to supplement local financial resources, and support local efforts to secure the basic "three guarantees" at the grassroots level.

Lan Fo'an stated that the next step will follow the changes in population development and the diverse needs of the people, further increasing the expenditure in related areas to better benefit people's livelihoods.

Lan Fo'an stated that the overall relief of local debt risks has been achieved, and the debt-to-equity work has achieved phased results. It is planned to significantly increase the debt limit at one time to replace the hidden debts of local governments. It is worth emphasizing that this upcoming policy is the most supportive debt-to-equity measure introduced in recent years, undoubtedly a timely policy intervention.

China's finance has enough resilience, and through comprehensive measures, it can achieve a balance between revenue and expenditure and meet the annual budget targets.

Issuing special national bonds to support large state-owned commercial banks in supplementing capital.

Lan Fo'an stated that since the beginning of this year, the finance department has adhered to an active fiscal policy, moderately increasing efforts and improving quality and efficiency. China's finance has sufficient resilience, and by taking comprehensive measures, it can achieve a balance between revenue and expenditure, and meet the annual budget target. The finance department will issue special national bonds to support large state-owned commercial banks in supplementing capital.

Utilizing tools such as local government bonds to support and promote the stabilization of the real estate market.

Lan Fo'an stated that the finance department will utilize tools such as local government bonds to support and promote the stabilization of the real estate market.

There is still a large room for increase in the central fiscal deficit.

Lanfoan stated that countercyclical adjustments are not only limited to four points, but other policy tools are also being studied, and there is still a large room for increase in the central fiscal deficit.

To avoid excessive taxes and effectively protect the rights and interests of business entities.

Lanfoan stated that in their work, both raising fiscal revenue in accordance with the law and regulations and avoiding excessive taxes to effectively protect the rights and interests of business entities are important.

Encourage eligible regions to revitalize idle assets, strengthen the management of state-owned capital returns.

Lanfoan expressed the encouragement for eligible regions to revitalize idle assets, strengthen the management of state-owned capital returns, make efforts to increase fiscal revenue, guide regions to use budget stabilization funds and other existing funds in accordance with the law and regulations to ensure the needs of fiscal expenditures.

Guide regions to use budget stabilization funds and other funds to ensure the needs of fiscal expenditures.

Lanfoan stated that the Ministry of Finance will effectively supplement the comprehensive financial resources of local governments by 400 billion yuan. Encourage eligible regions to revitalize idle assets, strengthen the management of state-owned capital returns, make efforts to increase fiscal revenue, guide regions to use budget stabilization funds and other funds in accordance with the law and regulations to ensure the needs of fiscal expenditures.

Make full and proper use of various types of debt funds.

Lan Foan stated that making full and proper use of various types of debt funds, currently the issuance of national bonds is accelerating, special ultra-long-term national bonds are being successively issued, in the next three months, a total of 2.3 trillion yuan of special bond funds can be arranged for use across the country.

By the end of 2023, the implicit debt included in the national government debt information platform has decreased by 50% compared to the 2018 baseline.

Lan Foan stated that preventing and resolving local government debt risks is crucial for sustainable fiscal development. Since 2015, the Ministry of Finance, together with relevant departments, has taken a series of measures, issuing local bonds to replace outstanding government debts, promoting Beijing, Shanghai, and Guangdong to clear their outstanding implicit debts. In the second half of 2022, some regions began to show signs of debt risks. In July 2023, the Central Political Bureau meeting required the formulation of a comprehensive debt restructuring plan. The Ministry of Finance has allocated over 2.2 trillion yuan in local government bond quotas to support local governments in resolving outstanding debt risks and clearing overdue corporate accounts. By the end of 2023, the implicit debt included in the national government debt information platform has decreased by 50% compared to the 2018 baseline.

Proposed to increase the scale of one-time debt limit drastically, replacing the outstanding implicit debts of local governments.

Lan Foan stated that it is proposed to significantly increase the one-time debt limit and replace the outstanding implicit debts of local governments, intensifying efforts to support local government debt risk resolution. Relevant policies will be fully explained to the public after completing the statutory procedures. This policy is the most substantial measure to support debt restructuring introduced in recent years, serving as a timely help that will greatly alleviate the pressure on local governments, freeing up more resources to support economic development and strengthen the grassroots "Three Guarantees."

Editor/Somer