China to end fiscal expansion when ongoing projects completed: MoF's Xiang

SHANGHAI (AFX-ASIA) - China will end its active fiscal policy when the ongoing state infrastructure projects have been completed and when reforms of investment and fund-raising systems have laid the basis for sustained growth in domestic demand, Minister of Finance Xiang Huaicheng said, according to Shenzhen's Securities Times.	    According to the report, Xiang said the ongoing infrastructure projects will require 600 bln yuan to complete, adding that two years' issuance of treasury bonds for infrastructure projects, combined with bank loans and non-government investment, should be sufficient to fund completion of the projects.	    He said the country cannot rely on infrastructure and fixed-asset investment to stimulate domestic demand, while fixed-asset investment should also not be dependent on government spending.	    Consequently, government departments are currently researching how to reform investment and fund-raising systems, he said.	    Xiang also said the country's active fiscal policy will not cause inflation.	    Noting that financial institutions' total deposits at end-2000 amounted to 12.38 trln yuan, while total loans amounted to 9.94 trln yuan, he said the issue of treasury bonds and the use of their proceeds on infrastructure projects will not lead to an increase in money issuance.	    In addition, the stable level of economic growth, and the rich supply of goods, will also act to prevent inflation, he said. 

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