The Statement of Minister Xiang Huaicheng at the Press Conference
Held by the Information Office of the State Council

(26 January 2000) 

Ladies and Gentlemen:

First of all, I would like to express my thanks to Mr. Zhao Qizheng, Minister of the Information Office of the State Council for giving me this opportunity to meet with Chinese and foreign journalists.

Before answering your questions, I would like to brief you on the performance of last year's state budget. According to the summary statements of local budget authorities, the general performance of state budget in 1999 is quite satisfactory. Preliminary analysis shows three characteristics: firstly, national fiscal revenue grew rapidly, and exceeded 1 trillion RMB for the first time in history. The revenue is increased by around 15% over the previous year. The ratio of fiscal revenue to GDP is further improved from the previous year's 12.4%. Secondly, the structure of fiscal expenditure has been adjusted and optimized. Finance authorities at various levels have actively taken measures on the reform of expenditure administration to meet the requirement of setting up public finance framework, and made great efforts to adjust and optimize expenditure structure in light of the principle of securing key expenditure. Compared with 1998, in 1999, the central expenditure on education is increased by more than 20%; S & R expenditure is increased by around 14%; the growth rate of capital construction expenditure is relatively higher, exceeding 70%, due to the continuous implementation of expansionary fiscal policy, with increased investment in agriculture, forest and water conservation, natural forest preservation, and in other infrastructure sectors; the social security expenditure for SOE lay-offs and pension has increased by 170%. Thirdly, the central fiscal deficit was managed within the figures allowed by the adjusted budget, and the local budgets have slight surplus. The detailed figures of the performance of 1999 state budget are yet to be finalized, it will be announced to the public after NPC's review during the 3rd Session of the 9^th National People's Congress in March this year.

The fiscal achievement made in 1999 comes from the joint efforts of the whole country. Here, I would like to take this opportunity to extend my gratitude to all the local governments and agencies concerned, for their support to the work of public finance. My thanks also go to our friends from the media, who have in the past year given great support to the work of Ministry of Finance.

Now, my colleagues, Mr. Jin Liqun, Mr. Gao Qiang and myself would like to answer your questions.