China’s Jan-Aug fiscal revenue growth slows despite policy support

BEIJING – China’s fiscal revenue rose 10% in the Jan-Aug period of 2023, slower than 11.5 percent growth in Jan-July, official data showed, even as the economy showed signs of stabilization in the wake of recent policy support measures.

Fiscal revenue totaled 15.18 trillion yuan ($2.09 trillion) for the eight months, while fiscal expenditures grew 3.8 percent to 17.14 trillion yuan, the finance ministry said in a statement on Friday.

In August alone, fiscal revenue fell 4.6 percent on year, cooling from a 1.9- percent gain in July, according to Reuters calculations based on the official data. Meanwhile, fiscal expenditure rose 7.2 percent, sharply reversing a 0.8- percent slide in July.

With a raft of measures put in place to arrest a downturn after a fleeting post-pandemic recovery, the world’s second-largest economy is seeing early signs of stabilization.

READ: China August industrial output, retail sales growth beat expectations

Government revenue from state land sales fell for the 20th consecutive month in August, extending declines to 22.2 percent from a year earlier from a fall of 10.1 percent in July, according to Reuters calculations based on the ministry’s data.

Consumer prices returned to positive territory in the month, while new yuan loans beat estimates, nearly quadrupling in August from July.

READ: China’s property slump worsens, clouding recovery prospects

Still, more support is expected – notably for the crisis-hit property sector – as the economy, grappling with weak demand both at home and aboard, remains under pressure to hit Beijing’s annual GDP target of around 5 percent for this year.

A Reuters poll of economists pointed to further downside risks to China’s growth prospects, as policymakers continue to face an uphill task in reviving the economy.

($1 = 7.2674 Chinese yuan renminbi)