China may fix fiscal spending shortfall next week, policy adviser says

China’s top legislative body could adjust the national budget plan next week, likely approving an additional 1.5 trillion yuan (US$210 billion) to 2.5 trillion yuan in treasury bonds as part of its economic stimulus package, a central bank policy adviser said on Tuesday.

“China’s fiscal spending is falling short of its annual target,” said Wang Yiming, vice-chairman of the China Centre for International Economic Exchanges, a Beijing-based governmental think tank.

“Estimates suggest a government funding gap of around 1.5 trillion yuan, which will need to be covered by additional bond issuance.”

In the first nine months of the year, China’s general public spending rose by 2 per cent year on year, while government fund spending dropped by 8.9 per cent, official data showed, both far from the 2024 targets of 4 per cent and 18.6 per cent growth, respectively.