China's MOF: More proactive fiscal policy to continue in 2026

"Being more proactive will be reflected not only in a larger funding scale, but also in higher efficiency in the use of funds," Minister of Finance Lan Fo'an said at the meeting.

The conference outlined six major fiscal tasks for next year, led by boosting domestic demand and supporting the development of a strong domestic market. Notably, funding for trade-in programs for consumer goods will remain in place in 2026, with adjustments to be made regarding subsidy coverage and standards.

Fiscal policy will also play a larger role in accelerating the integration of technological and industrial innovation to cultivate new growth drivers, with increased funding directed toward areas such as human development. Management of related funds will be improved, while the role of enterprises as the main drivers of innovation will also be enhanced.

Improving livelihoods remains a central focus. Fiscal policy will prioritize employment stabilization, income growth, and better access to education, healthcare, and social security.

Other priorities include advancing urban-rural integration and regional coordination, promoting a comprehensive green transition, and expanding international financial and economic cooperation to support higher-level liberalization.

Luo Zhiheng, chief economist at Yuekai Securities, observed that fiscal spending is increasingly shifting toward a more balanced approach. "The focus is moving from investment alone to both investment and consumption, from supply-side support to a combination of supply and demand, and from enterprises to both businesses and households," he is quoted as telling Xinhua, adding that he expects fiscal resources to tilt further toward households and social welfare in the future.

Written by Molly Liao, liaoliying@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com