China will adopt a more proactive fiscal policy in 2025 to support key areas like domestic demand, consumption, and long-term economic growth. Following the national fiscal work conference, which concluded on Tuesday, the government outlined plans to raise the fiscal deficit-to-GDP ratio, issue more government bonds, and prioritize fiscal measures aimed at boosting the economy.

As part of the new policy, China will increase fiscal expenditure and issue larger-scale government bonds to stabilize growth and optimize economic structure. The focus will be on improving livelihoods, stimulating consumption, and strengthening fiscal operations. Local governments will also receive more fiscal transfers to enhance their financial resources.

One of the main priorities for 2025 is expanding domestic demand. This will be achieved by increasing pensions for retirees, raising medical insurance subsidies, and expanding consumer goods trade-in programs. These efforts aim to stimulate consumption, which remains crucial for China’s economic recovery. Experts believe that increasing basic pensions, in particular, will improve livelihoods and encourage greater consumer spending.

In addition, the government will focus on supporting innovation and technological advancement, particularly for small- and medium-sized enterprises (SMEs). Fiscal measures will also prioritize urban-rural integration, green development, and modernizing the industrial system.