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State Council reviews 2001 budget and reveals 2002 draft budget      
   THU, MAR 07, 2002    

China's Finance Minister Xiang Huaicheng told Wednesday's NPC session that the country will continue to implement a proactive fiscal policy and increase domestic demand in the year 2002. The Finance minister briefed the nation on how the 2001 budget worked out, and spelled out what he wants to achieve in the coming fiscal year.

In his report, Finance Minister Xiang Huaicheng reviewed China's economic situation in the past year.

Xiang Huaicheng, Finance Minister said, "Against a backdrop of global economic slowdown, China's economy achieved a comparatively fast growth. It means more fiscal income and efficient spending. Government's macro-control has produced positive results."

In 2001, China's government at central and local levels generated a fiscal income of more than 1637 billion yuan, or about 200 billion US dollars. The amount was 22.2 percent more than the previous year. The nation spent over 1884 billion yuan, or about 230 billion US dollars.

The figures indicate a deficit of 30 billion dollars, an increase of nearly 19%. The deficit is roughly the amount approved by the last session of the NPC.

The minister attributed the income growth to a proactive fiscal policy, which led to larger domestic demand. He said the nation's overall economic development, improved enterprise earnings and strict taxation measures had fueled the income growth.

Xiang Huaicheng also said, "China continued to apply a proactive fiscal policy in 2001. The state issued 150 billion yuan, or over 18 billion US dollars of long term bond to collect fund for infrastructure construction. It not only helped start a series of key western development projects including the Qinghai-Tibet railway and power transportation from the west to the east, but also played a part in completing a number of other important projects."

For the 2002 draft budget, the state council predicted a 10 percent growth in income, which brings the amount to about 220 billion US dollars, and deficit is expected to increase by 12 percent.

Xiang Huaicheng called for increased investment in agriculture and scientific education, and stricter supervision on budget management.

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