China should strive to stabilize 2020 growth at about 5% by raising deficit-to-GDP ratio above 3% - China Press

The China Economic Weekly carried an article on Wednesday, citing Huang Qifan, Vice Chairman of the China Center for International Economic Exchanges and a former mayor of Chongqing city, as he made some comments on the Chinese economic growth for this year.

Key Quotes:

“China should strive to stabilize 2020 growth at about 5% by raising the deficit-to-GDP ratio above 3% and issuing an additional CNY1 trillion of special government bonds.

Advocated tax and fee cuts for small companies and transfer payments for areas affected by the coronavirus outbreak.

The central bank should also step up its purchases of government bonds and further lower the reserve requirement ratio and interest rates after the epidemic eases in Q2.”

This comes after both Goldman Sachs and S&P rating agency slashed the Chinese 2020 GDP forecasts, in the face of the coronavirus epidemic.

• S&P: Coronavirus will trim a 0.3 percentage point from global GDP growth in 2020
• China’s 2020 GDP forecast slashed to 5.2% vs. 5.8% previous – Goldman Sachs

Meanwhile, the Asian stocks trade in the green amid a slowdown in the new coronavirus cases. USD/JPY re-attempts 110.00 while the US Treasury yields jump nearly 1.5%.