China has pledged a package of 4 trillion yuan (US$559 billion) worth of cost cuts for the country’s struggling factories and merchants in 2020, the largest economic rescue plan in its history, in an enhanced effort to save jobs that were put at risk by the coronavirus outbreak, Premier Li Keqiang confirmed on Thursday.
The combined cuts in business costs, which include tax exemptions, lower bank interest rates and waived contributions to social welfare funds as well as reduced prices for utilities such as electricity, will be carried out on top of 2 trillion yuan in additional fiscal spending and government bond issuances.
In contrast to the 4 trillion-yuan stimulus package China issued in 2008 in response to the global financial crisis, which focused on debt-fuelled state spending and left the country with a large overhang of debt, Li said on the final day of the delayed National People’s Congress (NPC) that the new round of pro-growth measures would focus on “ensuring employment, people’s livelihoods and [helping] market entities”.
South Hina Morning Post
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