China pledges to increase public spending in 2025 to confront Trump’s tariffs

 The Chinese Ministry of Finance announced on Tuesday that it will increase public spending with a greater focus on boosting consumption to support the economy during 2025, in light of the escalation of US President-elect Donald Trump’s threats to increase customs tariffs. Which may deeply affect the growth of the Chinese economy, according to a Bloomberg report.

China’s announcement of expanding the volume of fiscal spending and accelerating its pace came in a statement issued today, Tuesday, following the China Central Economic Work Conference, which was held by the Ministry of Finance regarding… Fiscal work during 2025.

The meeting reiterated calls made by senior leaders of the ruling party at an annual economic conference to set the agenda earlier this month, including raising the deficit in the general budget and issuing more bonds. Government.

In addition, the Ministry of Finance pledged to intensify support for the consumer product barter program and expand government investment. Some economists expect a total increase in fiscal stimulus equivalent to about 2% of GDP, which is still modest at the global level.

This measure is likely to be less than the kind of radical measures that analysts believe. They are needed to stop the deflationary spiral and save the real estate market.

Chinese leaders plan to set an annual growth target of about 5% for next year, and raise the budget deficit to 4% of GDP from 3% this year.

And while Regarding government spending, the Ministry of Finance pledged to improve the spending structure to better benefit people’s livelihood and consumption, and also pledged to prevent the imposition of unjustified fines and fees on companies.

The Chinese government faces a strong challenge between achieving internal stability and responding to… US protectionist policies and increased customs duties on Chinese exports, which constitute a major driver of growth, as Chinese exports contributed to enhancing GDP growth during 2024 amid a slowdown in the real estate market.

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