On the 20th, the State Council Information Office held a press conference, at which Liao Min, Vice Minister of Finance, introduced the relevant situation of giving play to the role of proactive fiscal policy to promote the high-quality economic and social development. At the conference, Liao Min disclosed that 1.3 trillion yuan worth of ultra-long-term special treasury bonds would be issued in 2025 to sustainably support the "Two Priorities" and "Two New Areas".
On January 20, the State Council Information Office of the People's Republic of China held a press conference in Beijing. Liao Min, Vice Minister of Finance, Li Xianzhong, Director-General of the Comprehensive Department of the Ministry of Finance, and Yu Hong, Director-General of the Financial Department of the Ministry of Finance, introduced the relevant situation of leveraging proactive fiscal policy to advance high-quality economic and social development, and answered questions from the press.
Liao Min stated that China's economy shifted toward new growth drivers and high-quality development in 2025, demonstrating strong resilience and vitality. The Ministry of Finance earnestly implemented the decisions and arrangements of the Party Central Committee and the State Council, adopted a more proactive fiscal policy, and maintained sustained and stronger efforts, which played an important role in advancing the accomplishment of the annual economic and social development goals and tasks. To sum it up in one sentence: the more proactive fiscal policy in 2025 struck a balance between addressing immediate needs and pursuing long-term development. It not only effectively supported current economic growth and delivered tangible benefits to the people's livelihood, but also propelled the transformation of China's economic structure, laying a solid foundation for the medium and long-term sustainable economic and social development. Specifically, the following four key aspects of work were carried out:
1. Strengthening Counter-cyclical Adjustment
First, the deficit rate for 2025 was set at around 4%, an increase of 1 percentage point over the previous year. The newly added government debt scale reached 11.86 trillion yuan, an increase of 2.9 trillion yuan compared with the previous year, both far exceeding the average levels of recent years.Second, 500 billion yuan worth of special treasury bonds were issued to replenish the core tier-1 capital of large state-owned commercial banks, effectively enhancing the ability of China's banking sector and even the entire financial industry to support the real economy.Third, a 500 billion yuan quota of unused local government debt was allocated to supplement local governments' comprehensive fiscal resources and expand effective investment.Despite the expansion of deficit and government bond scale, China's government debt ratio remains relatively low from an international perspective, and is far below the average level of G20 countries.
2. Focusing on Boosting Consumption
This work includes the following three aspects:First, 1.3 trillion yuan worth of ultra-long-term special treasury bonds were issued to sustainably support the "Two Priorities" and "Two New Areas". Among this amount, 300 billion yuan was earmarked as funds for the consumer goods trade-in program. This tangible financial subsidy boosted consumer spending, and drove the sales volume of related commodities to exceed 2.6 trillion yuan. A large number of green, low-carbon and intelligent products accelerated their entry into people's daily lives, which not only continuously improved people's quality of life, but also promoted economic transformation and development.Second, consumption potential was stimulated from both the supply and demand sides. Policies on interest subsidies for personal consumption loans and loans for service sector business entities were introduced and implemented. Support was provided for pilot programs of new consumption formats, models and scenarios, as well as the construction of an internationalized consumption environment.Third, policies on duty-free shops and the departure tax refund for tourists were adjusted and optimized, and the number of duty-free shops was increased to encourage and expand relevant consumption.
3. Continuously Enhancing Livelihood Security
The main work focused on the following five aspects:First, the employment-first orientation was upheld. The central government allocated 66.74 billion yuan in employment subsidies, enriched policy tools for stabilizing employment, introduced policies such as expanding the scope of social insurance subsidies and increasing the intensity of unemployment insurance premium refunds for enterprises retaining employees, and extended the policy of reducing unemployment and work-related injury insurance premium rates.Second, the fiscal subsidy standards for residents' medical insurance and basic public health services were raised to 700 yuan and 99 yuan per capita per year respectively. In 2025, the central government allocated a total of approximately 490 billion yuan in relevant subsidies.Third, the basic pension level for retirees was increased by an overall 2%, and the national minimum standard for basic pension for urban and rural residents was raised by 20 yuan per person per month. In 2025, the central government allocated about 1.2 trillion yuan in basic pension insurance subsidies.Fourth, the free preschool education initiative was gradually promoted, exempting childcare and education fees starting from the senior class of kindergartens, benefiting approximately 14 million children. In addition, the standards for national scholarships and grants were raised, and their coverage was expanded.Fifth, a childcare subsidy system was established. The national finance allocated 100 billion yuan to provide childcare subsidies for infants under the age of 3, and personal income tax exemption was granted for these subsidies.From the above figures, it can be seen that the national fiscal investment in livelihood security has been continuously increasing and delivering strong support. These direct and inclusive policies for the people help enhance residents' consumption capacity and stimulate their willingness to consume.
4. Adhering to Balancing Risk Prevention and Development Promotion
Fiscal sustainability is an inherent requirement for a major economy and also a global challenge. To this end, the Ministry of Finance has been committed to building a stable and sustainable fiscal system. In 2025, we persisted in resolving debts through development and promoting development while addressing debts.First, a 2 trillion yuan quota was continued to be allocated for replacing existing implicit debts.Second, 800 billion yuan worth of newly added special bonds were arranged to supplement the financial resources of local government-managed funds, supporting debt resolution.Third, the whole-process management of the replacement of existing implicit debts was strengthened, and local governments were guided and urged to carry out scientific classification and precise debt replacement. After the replacement in various regions, the average interest cost of debts was reduced by more than 2.5 percentage points, which greatly alleviated the burden on local governments and enhanced their development momentum.With the implementation of various measures as scheduled and their continuous effect, the risk of local government debt in China has gradually subsided, and the positive interaction between economic development and debt management has been continuously strengthened.Fourth, solid efforts were made to ensure the "Three Guarantees" (guaranteeing salaries, operation and basic public services) at the grassroots level, and the overall operation of local public finance remained stable.
Liao Min emphasized that overall, the 2025 fiscal policy adhered to serving the overall development, took proactive actions, and fully reflected a more proactive policy orientation. It provided important support for the macro economy to forge ahead against headwinds and maintain a stable and positive momentum, which has been widely recognized by industry insiders both at home and abroad.
