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after the recent implementation of a package of policies to boost the economy, how fiscal policy will "relay" has become the focus of attention from the market and academic circles.

on september 26, the political bureau of the central committee held a meeting and clearly proposed “increasing efforts to launch incremental policies.” in terms of fiscal policy, the meeting emphasized the need to increase countercyclical adjustment of fiscal and monetary policies, ensure necessary fiscal expenditures, and effectively implement the "three guarantees" work at the grassroots level. it is necessary to issue and make good use of ultra-long-term special treasury bonds and local government special bonds to better play the role of government investment in driving investment.

in an exclusive interview with the paper, jia kang, founding director of the china institute of new supply-side economics, said that it is very necessary to "amplify" monetary policy in the near future, and fiscal policy must keep up. these are the two most important policies for macroeconomic control. it must be done in coordination.

at the 2024 tsinghua pbc chief economist forum held on september 28, yu yongding, a member of the chinese academy of social sciences and former director of the institute of world economics and politics, pointed out that currently, economists have converged views on many issues - - acknowledged the serious challenges currently faced and agreed to adopt more loose fiscal and monetary policies. the policies proposed by the central bank recently are very good and have received positive reviews. for these policies to continue to be effective, the financial sector will also need to work hard.

luo zhiheng, chief economist of guangdong securities, believes that the current policy combination and coordination must be paid attention to, and the impact of individual troops on boosting confidence and expectations is limited and will eliminate the policy effect. relying solely on monetary and financial policies, without the cooperation of fiscal and real estate policies and the strengthening of expectation management, will lead to unstable confidence and expectations, and it will be difficult to promote market entities to increase consumption and investment.

in addition to the consensus that fiscal policy urgently needs "relay", the direction of policy efforts is also the focus of discussion.

lu ting, chief economist of nomura china, suggested that in the short term, the top priority is to ensure the basic operation of local governments and increase the amount of funds raised through the issuance of government bonds.transfer payment. in the short and medium term, we should do a good job in ensuring the delivery of housing, and ensuring the delivery of housing is better than purchasing and storing. this mainly solves the problems that arise in the pre-sale system.market failureand government failure are most important to rebuilding market confidence. in addition, another direction is to provide subsidies to specific groups of people, including increasing the pension level of farmers. this policy has a low implementation cost but can also bring higher benefits.

luo zhiheng suggested that the fiscal "relay" in the next stage can have five major measures. first, increase the budget deficit during the year, issue more government bonds, ensure necessary expenditures, and offset the contraction in expenditures caused by the decline in land transfer income and tax revenue. the second is to speed up the issuance of special bonds. on the one hand, it will relax the scope of use of special bonds, and on the other hand, it will consider adjusting the quota of some special bonds to general bonds. the third is to issue cash subsidies to some specific groups such as unemployed college students, rural elderly groups, and families with two children or more, and gradually establish a screening mechanism and infrastructure for subsidy groups using personal tax apps and other services. the fourth is to optimize the "debt reduction" policy and promote local governments to return to normalcy and development from the emergency state through the issuance of additional treasury bonds to avoid the shrinkage effect of debt reduction. the fifth is to issue more treasury bonds and explore the establishment of a "real estate stabilization fund" at the central level, which will be used specifically for guaranteeing housing delivery, purchasing and storing, etc., with unswerving determination and sending a strong signal to promote real estate to "stop falling and return to stability."

zhong zhengsheng, chief economist of ping an securities and director of the research institute, also suggested that in the short term, the scope of use of special bonds can be expanded in stages, such as supporting real estate acquisition and storage in various places, used by local governments to issue consumption subsidies, and used for investment in the public sector (including occupations). education, medical and health, cultural tourism, etc.). in the medium to long term, considering the limited number and scale of desirable projects, it is necessary to control the new quota of special bonds and optimize the government debt structure. on the one hand, some special debt quotas can be converted into general debt quotas, so that they can be used to supplement grassroots financial resources. on the other hand, we will moderately control the new quota of special bonds and increase the issuance of ultra-long-term special government bonds.

at the same time, zhong zhengsheng also suggested that additional issuance of national debt be put on the agenda. he pointed out that incremental fiscal policies suggest planning early and issuing another 1 trillion to 2 trillion ultra-long-term special government bonds to make up for the gap in fiscal revenue reduction. in particular, the implementation lag of fiscal policy is relatively long, and it is even more necessary to prepare ahead of time to deal with overseas uncertainties. it is not appropriate to reserve financial space until the end of the year or the beginning of next year.

there are also views that the current fiscal policy thinking also needs to be adjusted. yu yongding pointed out that at present, some formulations and practices in fiscal policy are actually pro-cyclical and need to be reconsidered.

luo zhiheng believes that the concept of fiscal policy needs to be optimized, including breaking the deficit rate of 3%, fiscal policy should focus more on expenditure growth rather than deficit ratio targets, and more expenditure policies should be adopted instead of tax and fee reduction policies on the income side.

there are only three months left in this year, and the performance of fiscal policy deserves attention. jia kang suggested that in the fourth quarter of last year, the central government issued an additional 1 trillion yuan of treasury bonds as special treasury debt management, which was a very important measure to guide expectations. this year, it is necessary to draw on past experience to truly implement the spirit of this politburo meeting. good.

yu yongding believes that in addition to the government's active project reserve, it also needs to launch a package of policies, including a fiscal and monetary stimulus plan. even if it is too late to do so now, we must tell everyone to do so. this can fully boost market confidence, even if this year economic growth is below 5%, but prospects will be better next year.