China: Faces Fiscal Problems cause of Unemployment
Beijing, Apr. 16 2002 (VOA News) -- China's
finance minister says the government faces "grim" fiscal problems coping with the rising unemployment, and cannot
afford a tax cut. Beijing says it must cut spending rather than
borrow more money.
Finance
Minister Xiang Huaicheng says deficit spending is a "price
we have to pay" if China's economic reforms are going
to work. He says "the government is going to have to
trim expenses because spending is growing much faster than
revenue, a situation he calls 'grim.'"
The minister
says China's economy grew at a brisk 7.6 percent during the
first quarter. That is above the seven percent level government
experts say is the minimum needed to create new jobs for the
growing number of workers who lost their jobs in the restructuring
of the inefficient state-run enterprises. Mr. Xiang says "it
is a government responsibility to show more concern for these
workers and their families and give them more financial help."
But Mr.
Xiang says there are "enormous" demands for money
to help boost the social security system, environmental improvements,
education and other urgent needs.
He says
he is under pressure to cut taxes to stimulate the economy,
but argues that tax cuts would not do much in China's moderate
tax environment. He says the economy is doing well and no
tax stimulus is needed.
- Jim
Randle - Voice of America in Beijing
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Reprinted with the permission of Voice of America
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