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Vice Finance Minister Liao Min told a press conference that China would roll out additional fiscal policy measures in a timely manner in response to economic developments. National Bureau of Statistics figures show the gross domestic product expanded 4.7 percent in the first half of 2026, with the second quarter slowing to 4.3 percent year on year from 5.0 percent in the first quarter, highlighting softening momentum in the world’s second-largest economy. Liao Min said authorities would maintain the continuity and stability of macroeconomic policies while planning and allocating fiscal resources over a longer time horizon.
A greater share of fiscal spending will be directed towards households and consumption to address weak domestic demand, Liao Min added during the August 21 briefing. The vice minister stated that coordination between fiscal, monetary and industrial policies would be strengthened and the policy toolkit refined as economic conditions change. Authorities are preparing new fiscal and financial support measures for the second half of the year in conjunction with the central bank and other regulators, though he offered no specific details on the initiatives.
According to the finance ministry, the government has expanded loan interest subsidies for small private firms and consumers as part of efforts to stimulate demand. The program subsidises one percentage point of interest on qualifying small-business loans for as long as two years, extends coverage to credit-card installment products and increases the subsidy caps. These adjustments come as policymakers seek to ease pressure on businesses and households following the first-half growth figures.
The July Politburo meeting directed that already budgeted infrastructure spending be accelerated for the remainder of 2026 instead of launching large-scale new stimulus packages, a Reuters report on the gathering noted. Beijing has set a budget deficit target of approximately 4 percent of gross domestic product for the year and pledged to speed up bond issuance to underpin expansion. A readout of the July 30 meeting published by Xinhua called for practical and effective incremental measures to support the annual growth goal of around 5 percent.
The central bank has signaled it will keep a loose monetary policy stance and deploy practical steps when required without announcing immediate reductions in key rates or reserve ratios. Liao Min further indicated that fiscal and tax reforms would be deepened, the budget management system improved and a clearer division of responsibilities established between central and local governments to foster more balanced regional development. These steps are intended to strengthen the overall policy framework amid ongoing economic adjustments.
Liao Min emphasised that preventing local governments from accumulating fresh hidden debt must remain an iron discipline. He added that fiscal risks, especially those related to local government borrowing, need to be reduced in a steady manner. The comments underscore the authorities’ focus on containing financial vulnerabilities while pursuing measures to sustain growth.
