Page 11 - REPORT ON THE WORK OF THE GOVERNMENT

doubled over the past decade.
We channeled more financial resources toward lower levels of government,

with the share of transfer payments to local governments rising to about 70 percent
of central government expenditures. We introduced direct allocation of central
budgetary funds to prefecture- and county-level governments and made it a
regular practice.

At every level, governments kept their belts tightened by strictly controlling
general expenditures, and central government departments led the way in cutting
back spending. We also put idle funds and assets to good use and tapped every
means possible to see that these funds were used to benefit businesses and people.

Over 70 percent of government expenditures went toward ensuring the people’s
wellbeing.
We continued a prudent monetary policy.
We made flexible policy adjustments in view of new developments and
maintained reasonably sufficient liquidity. We made good use of policy

instruments such as required reserve ratio reductions and re-lending to increase
effective support for the real economy and alleviate the difficulties faced by
MSMEs in accessing affordable financing.
The balance of loans to the manufacturing sector increased from 16.3 trillion

yuan to 27.4 trillion yuan. Inclusive loans to micro and small businesses increased
at an annual rate of 24%, rising from 8.2 trillion yuan to 23.8 trillion yuan, with the
average interest rate falling by 1.5 percentage points compared to five years ago.
Efforts were intensified to settle overdue payments to small and medium

enterprises (SMEs).
The RMB exchange rate floated with greater flexibility at an adaptive, balanced
level while remaining generally stable. We completely paid off the outstanding
debt of 1.4486 trillion yuan that was incurred in the reform of financial institutions

such as state-owned commercial banks and rural credit cooperatives decades ago.
Using market- and law-based means, we took targeted steps to deal with the
risks of several large enterprise groups and made steady headway in defusing
risks in high-risk small and medium-sized financial institutions.
Large financial institutions registered sound growth, financial systems

operated in a robust and stable manner, and we ensured that no systemic risks
arose.
We pursued an employment-first policy.

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