China schedules meeting expected to reveal fiscal stimulus details
A general view shows the skyline over the central business district in Beijing on Feb. 28, 2023.
Jade Gao | Afp | Getty Images
BEIJING — China’s parliament will hold a highly anticipated meeting Nov. 4 to 8, state media said Friday, according to a CNBC translation.
Investors have been awaiting news of the gathering of the standing committee of the National People’s Congress, which is expected to announce details on any fiscal stimulus.
Last year, the committee’s meeting in late October oversaw a rare increase in China’s fiscal deficit to 3.8%, from 3%, which was subsequently reported by state media.
This parliamentary meeting is a key part of the process, if China once more wants to press ahead with adjusting the national budget or deficit, said Bruce Pang, chief economist and head of research for Greater China at JLL.
He pointed out that the last month of Chinese stimulus measures have all underscored the need for more fiscal support.
Earlier this month, China’s Minister of Finance Lan Fo’an told reporters that there was room to increase the deficit and issue more bonds. He indicated at the time that significant changes had to be processed before being announced.
His remarks followed a meeting of top leaders in late September led by Chinese President Xi Jinping, which called for strengthening fiscal and monetary policy.
The People’s Bank of China has cut various rates and extended real estate support policies. Chinese stocks have surged in the weeks since the late-September meetings, with trading turning volatile in the absence of more concrete measures.
Pang said the upcoming parliamentary meeting should confirm how the budget will be adjusted and communicate any potentially planned bond issuance.
Analysts have tempered expectations that large-scale fiscal stimulus would directly pillar consumption, instead noting how struggling local governments would likely get support first.
China’s economy grew by an annual 4.8% in the first three quarters of the year, slightly slower than the 5% pace observed in the combined first half of the year. Beijing has a target of around 5% economic growth for the whole of 2024.