BEIJING (Reuters) - China’s fiscal spending increased 15 percent during January-March from year ago levels to support economic growth, and local governments quickened their bond issuance for key projects, the finance ministry said on Tuesday.
For the whole of 2018, fiscal spending rose 8.7 percent from 2017 levels, according to finance ministry data.
“The relatively strong fiscal spending provided forceful funding support for implementing major national development strategies, pushing reforms in key areas and improving people’s livelihood,” Hao Lei, a finance ministry official told reporters in a briefing.
Hao said that faster issuance of local government bonds also helped stabilise economic growth.
Local government bond issuance stood at 1.18 trillion yuan in January-March period, compared with a total issuance worth 2.17 trillion yuan last year.
The world’s second-largest economy is growing at its slowest pace in almost three decades amid weaker domestic demand and a nine-month trade war with the United States.
Campaigns during the past several years to curb debt risks and pollution have also deterred fresh investment.
Planned cuts to value-added tax will put pressure on revenues, but the revenue growth target for 2019 is still expected to be reached, according to Li Dawei, another finance ministry official.
Fiscal revenue rose 6.2 percent from a year earlier in the first quarter, finance ministry data showed.
Reporting by Kevin Yao and Stella Qiu; Editing by Simon Cameron-Moore