A view of Beijing. Photo: Wikimedia Commons, Ahen0barbus

China’s fiscal revenue fell 14.5% to 6.21 trillion yuan (US$875.11 billion) in the first four months from the same period last year as economic activities were suspended due to the Covid-19 pandemic, according to data released by the Ministry of Finance.

The central government’s fiscal revenue decreased by 17.7% to 2.85 trillion yuan for the same period, while local governments’ fiscal revenue declined 11.5% to 3.36 trillion yuan.

The country’s tax revenue dropped by 16.7% to 5.31 trillion yuan. Non-tax revenue rose 1% to 905 billion yuan, said the Ministry of Finance.

By category, value-added tax decreased 24.4% to 1.99 trillion yuan, while corporate tax eased 13.7% to 1.29 trillion yuan. Vehicle purchase tax fell 22.3% to 96.4 billion yuan.

Stamp duty rose 9.2% to 106.9 billion yuan as stock trading was not suspended during the nationwide city lockdown period. Vehicle and vessel use, tonnage and cigarette taxes also increased by 0.6% to 35.3 billion yuan.

Meanwhile, the country’s public expenses declined by 2.7% to 7.36 trillion yuan. The central government’s public expenses grew 0.1% to 1.03 trillion yuan, while local governments’ public expenses were down by 3.2% to 6.33 trillion yuan.

Bond issuance

The People’s Bank of China (PBoC) said it issued 4.8 trillion yuan of various bonds in April, up 33% from 3.6 trillion yuan in the same period last year.

At the end of April, the outstanding amount of all the issued bonds totaled 104.6 trillion yuan, compared with 90.1 trillion yuan a year earlier.

Transactions in the interbank bond market amounted to 25.5 trillion yuan last month, up 44.8% from 17.6 trillion yuan from April 2019. Transactions in the inter-bank money market grew 42.2% to 122.7 trillion yuan for the same period.

Reverse repos

The PBoC said it skipped open market operations via reverse repos Tuesday due to the reasonable and sufficient liquidity in the banking system.

As no reverse repos matured, there was no net liquidity withdrawal from or net liquidity injection into the banking system on Tuesday. A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future.

Since the novel coronavirus outbreak, China has increased policy support on the monetary and fiscal fronts to help businesses, especially small ones, to tide over difficulties.

The central bank will strengthen counter-cyclical adjustments and adopt a more flexible monetary policy to fend off financial risks and support the real economy, PBoC governor Yi Gang wrote in an article released on the PBOC website on Saturday.

Company news

Huawei Technologies said it will do everything in its power to find a solution to the US government’s latest restrictions, which will block the Chinese tech giant and its suppliers from using US technologies to design and manufacture semiconductors.

The comments came after the US Department of Commerce issued the rules last Friday, which analysts said marked an escalation of Washington’s push to battle with China for global technology dominance, the China Daily reported Monday.

Huawei said in a statement that it categorically opposes the amendments made by the US Department of Commerce to its foreign direct product rule that targets Huawei specifically.

SF Express Co Ltd, an express service provider, said its operating income surged 47.8% to 12.04 billion yuan in April from a year ago. The company delivered 611 million parcels last month, up 88% from April 2019.

The company said it outperformed its peers, which recorded a 32% growth in the number of deliveries in April.

China’s express sector received a strong boost from the abnormal growth in online sales during the epidemic period, according to a research report published by Tianfeng Securities. Express service providers will see higher operating margins due to their growing economies of scale, it said.

The story was written by Yang Zhijie and Nadeem Xu and first published at ATimesCN.com