China’s 2025 government deficit ratio is set to be around 4%, 1 percentage point higher than last year, with the deficit size reaching 5.66 trillion yuan — an increase of 1.6 trillion yuan from the previous year, according to the government’s work report delivered by Chinese Premium Li Qiang.
China’s fiscal spending is projected to reach 29.7 trillion yuan this year, increasing by 1.2 trillion yuan from 2024.
The report also proposes issuing 4.4 trillion yuan of local government special bonds and 1.3 trillion yuan of ultra-long special treasury bonds, 300 billion yuan more than last year.
In addition, 500 billion yuan of special treasury bonds will be issued to support capital replenishment of large state-owned commercial banks, while 300 billion yuan of ultra-long special bonds will be allocated to support the renewal of consumer goods under the “old-for-new” scheme.
To boost the property and stock markets, the report says China will cut reserve requirement ratios (RRR) and interest rates at appropriate times, maintain ample liquidity, and align credit growth and money supply with economic and price targets.
The government also pledged to optimize and innovate structural monetary policy tools to promote the healthy development of the real estate and capital markets.
