According to Reuters, China had a considerably larger fiscal deficit in 2016 than it targeted. The preliminary deficit was 2.83 trillion yuan ($413 billion), which surpassed the forecast of 2.18 trillion yuan. This figure is a record-breaking one.
In 2016, fiscal expenditures rose 6.4% from the previous year, while revenue increased 4.5%.
The ministry says that China relied on government spending to stabilize economic growth in the past year, as private companies cut investments. At the same time the government expresses concerns about significant fiscal deficit, equivalent to 3% of GDP.
On January 20, the National Bureau of Statistics of the People's Republic of China released the information about China’s economic growth. Thus, country’s GDP was at 6.7% down from 6.9%, which is the lowest result in the last 23 years.
On January 6, China’s President Xi Jinping confirmed that China’s economic growth was at 6.7% in 2016. Meanwhile, China’s government will downgrade target forecast for GDP for 2017 from 6.5-7% to 6.5%.
