(Yicai) Dec. 24 -- China will implement a more proactive fiscal policy next year, including a rare increase in the fiscal deficit ratio, bigger government bond sales, and higher public expenditure to boost demand and raise living standards, according to the annual agenda-setting financial work conference.

The two-day National Financial Work Conference, which concluded in Beijing today, is considered an important window on the direction of fiscal policy in the coming year. The announcements from the meeting, contained in a statement from the finance ministry, align with the strategic objectives set out at the Central Economic Work Conference almost two weeks ago.

Fiscal policy in 2025 will aim to expand domestic demand and improve living standards through targeted measures, including raising pensions and medical insurance subsidies for residents, per the meeting.

The government plans to increase the scale of treasury bond issuance to support stable growth and structural adjustments. It will optimize expenditure allocation, strengthen targeted investments, prioritize public welfare, promote consumption, enhance economic resilience, and continue addressing risks in key areas.

Fiscal spending in 2025 will exceed this year’s, experts told Yicai, as the nation readjusts public expenditure to stimulate aggregate demand and promote steady economic growth.

They also noted that debt issuance will increase, with plans to expand the fiscal deficit by issuing additional regular sovereign bonds, more ultra-long-term special treasury bonds, and local government special bonds. The scale of new government borrowing is expected to reach around CNY15 trillion (USD2.06 trillion) next year.

The conference specified six key areas of focus for next year: expanding domestic demand, developing a modern industrial system, safeguarding public welfare, promoting urban-rural integration, advancing ecological civilization, and pursuing high-level opening-up.

It also emphasized administrative innovations, including zero-based budgeting reforms and improvements to the fiscal and taxation systems, aimed at preventing local government debt risks and enhancing governance.

Editor: Emmi Laine