The Chinese Government Only Has To Do Something To Raise The Deficit.

The spring of Washington is holding the annual IMF spring annual meeting. However, the second meetings of G20 finance ministers and central bank governors in the same period almost completely grabbed the trend of the IMF annual meeting.

China is the rotating country of G20 this year. Many Chinese financial chiefs, including Zhou Xiaochuan and Lou Jiwei, are present.

When it comes to China's economy, the "hot event" that has recently been mentioned is the two countries' international rating agencies (Moodie and S & P) have downgraded China's sovereign credit rating outlook, which seems to be full of worries about China's economic prospects.

One stone stirred up waves, Xinhua news agency and other media bombardment rating agencies, various experts and scholars also turned out the "old accounts" that the rating agencies predicted in the 2009 financial crisis, and the finance minister Lou Jiwei responded publicly: "we are not care."

However, it is true that "no care" does not need care? So far, the three major international rating agencies monopolize over 9 of the world's business. It is an important reference for major financial institutions to invest.

Lowering the outlook of China's sovereign credit rating is bound to increase the cost of overseas financing for Chinese enterprises.

In response to the downgrade, Vice Minister of finance also responded in an exclusive interview, but his tone was much stronger than Lou Jiwei's "no care": "they (rating agencies) have a sensational behavior for their own business, and at some point they show themselves, but their actions often make their credibility more impacted."

Coincidentally, Lou Jiwei also said at the G20 press conference: "rating agencies are biased, we do not blame it."

Whether it is biased or "grandstanding",

The IMF's outlook for raising China's 2016 and 2017 economy is a "direct criticism" of rating agencies' "far sighted and will be proved to be wrong".

During the two sessions this year, the Chinese government announced that it would raise the government's deficit to 3%. With reference to international experience, 3% of the deficit has stepped on the red line.

However, Zhu Guangyao is not worried about this because "China's deficit rate has increased to 3%, and the key is to reduce taxes."

He told reporters that in May 1st this year, the "camp to increase" will be fully implemented, and there will be a substantial tax cut.

He said: "most of the increase in revenue is used to support the implementation of the camp reform.

It is a solemn promise of the Chinese government that the tax burden of all industries has been reduced or not increased.

Minister of finance Lou Jiwei also mentioned at the G20 news conference.

The problem.

He said that even if the deficit rate was 3%, "the central government's debt is not high, and now the central government debt is increased to reduce the leverage of the whole society."

As for the huge scale of the worrying local debt, Lou Jiwei said: "measures have been taken to control the growth trend of local debt."

The information disclosed by Zhu Guangyao in an exclusive interview can be described as "stable and stable", which is similar to the idea conveyed by Lou Jiwei at the G20 press conference.

It can be summed up in one sentence: "do not listen to the rating agencies, take a look at the IMF report.

The prospect is optimistic, and the reform is long.

As for the way forward, where will it go? We will wait and see.

The rating agencies have made China "lose face" this time. China must take practical action besides "shelling".

In an interview, Zhu Guangyao said that the credibility of the international rating agency was badly hit by the Asian financial [0.00%] crisis in 1998 and the global financial crisis in 2008. "G20 has reached an important consensus on the reform of the international credit rating system, and the future countries still need to continue to carry out its implementation."

As to whether the G20 Hangzhou summit will discuss the reform of the international rating system and how it will be changed? Zhu Guangyao did not comment.