Sonali Ray, writer
Brief news
- China’s parliament will convene from November 4 to 8, with investors anticipating details on fiscal stimulus measures.
- The National People’s Congress may address the rising budget deficit and potential bond issuance to support the economy.
- Analysts expect local governments to receive priority in any financial assistance, as China’s growth rate has slowed to 4.8%.
Detailed news
BEIJING— According to a translation provided by CNBC, official media announced on Friday that the gathering of China’s parliament, which is eagerly awaited, will take place from November 4 to November 8.
An announcement on the assembly of the standing committee of the National People’s Congress, which is anticipated to provide specifics of any fiscal stimulus, has been eagerly anticipated by investors.
At the meeting that took place in late October of the previous year, the committee was responsible for overseeing an unusual rise in China’s budget deficit, which went from 3% to 3.8%. This increase was later published by official media.
According to Bruce Pang, chief economist and head of research for Greater China at JLL, this parliamentary conference is an important aspect of the process. If China wants to proceed with lowering the national budget or deficit once more, then this meeting is an essential component of the process.
He brought up the fact that the Chinese government’s attempts to stimulate the economy over the past month have all served to highlight the necessity of more financial assistance.
Lan Fo’an, China’s Minister of Finance, stated to reporters earlier this month that there was potential to increase the deficit and issue additional bonds. He stated at the time that substantial modifications required processing prior to their announcement.
His comments were made in response to a meeting of senior leaders in late September, which was chaired by Chinese President Xi Jinping. The meeting emphasized the importance of bolstering fiscal and monetary policy.
The People’s Bank of China has implemented a variety of rate reductions and has expanded its real estate support policies. Trading has become volatile in the absence of more concrete measures, as Chinese equities have surged in the weeks following the late-September meetings.
In his statement, Pang stated that the future meeting of the Parliament should affirm the manner in which the budget would be amended and notify any prospective bond issue that may be scheduled.
The expectation that a large-scale fiscal stimulus would directly pillar consumption has been tempered by analysts, who have observed that struggling local governments would likely receive support first.
During the first three quarters of the year, the national economy of China expanded at an annual rate of 4.8%, which is a pace that is somewhat less than the 5% growth rate that was seen during the first half of the year combined. Beijing’s objective for 2024 is to achieve an economic development rate of approximately 5%.
Source : CNBC News
