<div id="readability-page-1"><div><p>[BEIJING] China pulled back on fiscal spending in March as the economy rebounded at the start of the year despite disruptions caused by the war in Iran.</p><p>A broad measure of public expenditure fell 2.5 per cent last month from a year earlier, its biggest decline since October, according to Bloomberg calculations based on Ministry of Finance data released on Friday (Apr 24).</p><p>By contrast, broad fiscal revenue climbed 3.4 per cent, the most since July, leaving a deficit of over 1.5 trillion yuan (S$280.8 billion).</p><p>The world’s second-biggest economy saw growth pick up more than expected in the first quarter, in a turnaround from the end of last year as manufacturing powered ahead. The conflict in the Middle East has yet to pose a major threat to China, thanks in part to the country’s past moves to beef up energy security.</p><p>The surprise upswing in growth may have reduced the need for fiscal stimulus beyond what’s planned in the Budget for this year. Policymakers are also careful in extending support because of mounting debt concerns and shrinking government income.</p><p>There’s also less urgency for Beijing after it lowered its annual growth target to 4.5 to 5 per cent this year- the least ambitious goal since 1991.</p><div><div><div><p>SEE ALSO</p><div><div><div><div><p><img height="618" src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/b71b2cf442732fb2532d3a8a52c5329fb42585b55bae55ac347d253021fd57d2/query-ZHByPTEmZj13ZWJwJnc9MjQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="960" original-src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/b71b2cf442732fb2532d3a8a52c5329fb42585b55bae55ac347d253021fd57d2/query-ZHByPTEmZj13ZWJwJnc9MjQw"/></p></div><p></p><h3><span>China’s global EV push reflects its ambition - and harsh economics at home</span></h3><p></p></div></div><div><div><div><p><img height="640" src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/ebf45650adfb39ae2ce914007941946e729294571a6ee325aa4eac6e891f7d45/query-ZHByPTEmZj13ZWJwJnc9MjQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="960" original-src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/ebf45650adfb39ae2ce914007941946e729294571a6ee325aa4eac6e891f7d45/query-ZHByPTEmZj13ZWJwJnc9MjQw"/></p></div><p></p><h3><span>How China’s young workers are securing their future even as AI disrupts job market, triggers pay cuts</span></h3><p></p></div></div><div><div><div><p><img height="3884" src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/121e179ca35340f370ed8d08b4fc4d61f027d8d72c668010113399cbc623dcbd/query-ZHByPTEmZj13ZWJwJnc9MjQw?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="5826" original-src="https://imageproxy.pbkrs.com/https://cassette.sphdigital.com.sg/image/businesstimes/121e179ca35340f370ed8d08b4fc4d61f027d8d72c668010113399cbc623dcbd/query-ZHByPTEmZj13ZWJwJnc9MjQw"/></p></div><p></p><h3><span>Unemployment spikes for key Chinese age group as AI use spreads</span></h3><p></p></div></div></div></div></div><div><h3>Navigate Asia in<br/>a new global order</h3><p>Get the insights delivered to your inbox.</p></div></div><p>The conflict in the Middle East could still complicate stimulus plans, since the blocking of the Strait of Hormuz, a vital waterway for energy, is pushing up oil prices and risks weakening foreign demand for Chinese exports. BLOOMBERG</p><div><p>Decoding Asia newsletter: your guide to navigating Asia in a new global order. <span>Sign up here to get Decoding Asia newsletter.</span> Delivered to your inbox. Free.</p></div></div></div>

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<p>China reduced fiscal spending by 2.5% in March, marking its largest decline since October, despite an economic rebound. Fiscal revenue increased by 3.4%, resulting in a deficit of over 1.5 trillion yuan. The economy showed unexpected growth in Q1, reducing the need for additional fiscal stimulus. Policymakers are cautious due to rising debt and lower government income, especially after setting a modest growth target of 4.5-5% for the year. The ongoing conflict in Iran may complicate future stimulus plans, particularly with rising oil prices affecting foreign demand for exports.</p>

- In March, China reduced fiscal spending by 2.5% year-on-year due to an economic recovery, despite disruptions from the Iran conflict.  
- Conversely, fiscal revenue increased by 3.4%, leading to a deficit exceeding 1.5 trillion yuan.  
- While first-quarter growth surpassed expectations, concerns over rising debt and decreasing government income have led to a cautious approach in fiscal stimulus.

China scales back fiscal stimulus in first month of war in Iran