The implementation of China’s fiscal budget in the first-quarter of 2001 has secured rapid growth momentum in fiscal revenue, however, given the world climate, China should not be over-optimistic about its fiscal performance in the following months, remarked Minister of Finance Xiang Huaicheng during the press conference on April 12, 2001.
According to Minister Xiang, the year 2001 looks promising for China in terms of financial situation as its fiscal revenue in the first quarter hit 368.201 billion yuan, up 80.359 billion yuan, or 27.9 percent, on a year-on-year basis. Fiscal expenditure, on the other hand, has seen an increase of 45.656 billion yuan, or 19.2 percent, over the previous year.
However, the growth speed slowed down in March, and Xiang predicted that such trend might persist into the rest of the year. Judging from both the international and domestic climate, China should not be over-optimistic about its fiscal situation, argued Minister Xiang.
Xiang explained that the Chinese economy may be negatively influenced by the world financial forces, including the recent recession of the US economy, the continuing slackness of Japanese economy and the lingering effects of the Asian financial crisis.
When asked about the handling of bad banking loans, Xiang released that the bad loan ratio of the Chinese banks has seen a decrease since last year. For one thing, over 130 billion worth of bad loans were liquidated through debt-to-equity transition and other financial channels. The central bank’s intensified supervision over commercial banks has also led to improvement in the quality of bank loans.
(CIIC 04/12/2001)
