China's central bank to pay profits to fund fiscal spending: finance ministry

[BEIJING] China's central bank will be among state financial institutions paying some of their profits, including arrears, to the government this year to fund an increase in fiscal spending, the finance ministry said on Tuesday (Mar 8).

The People's Bank of China and other state-owned institutions and monopolies are required under Chinese law to pay part of their profits to the government, although this has been suspended for 2 years due to Covid-19, the finance ministry said in a statement on its website.

China Investment Corp, the sovereign wealth fund, and China National Tobacco, the world's biggest cigarette maker, are among the financial institutions and monopolies that will pay surplus profits from previous years, it said.

The finance ministry said in its 2022 budget released on March 5 it expected state-owned financial institutions and state monopolies to pay a total of 1.65 trillion yuan (S$356.3 billion) in profits this year.

The payments and other fund transfers will help boost fiscal spending by 2 trillion yuan this year, the ministry said.

China will step up its fiscal spending this year to support the slowing economy, despite a lower budget deficit ratio, Finance Minister Liu Kun has said. REUTERS