Government finances in China - statistics & facts
China’s fiscal budget
China is a country with a low to moderate government spending ratio. Total government expenditure amounted to around 33 percent of the GDP in 2022, while this amounted to nearly 39 percent in the United States. For other Western countries, such as the United Kingdom, Germany, or France, this surpassed 40 or even 50 percent. Among Asian countries, however, government spending ratios are considerably lower, and China is ranging in a medium position.The largest single item in the Chinese government budget for many consecutive years has been education. In contrast, welfare spending is considerably lower than in Western countries. Spending on social security and employment only accounted for around 14 percent of the total budget in 2022.
In recent years, revenues were increasingly not on par with expenditures. While budget deficits have been widening since 2011, total government debt is mounting up and reached 77 percent in 2022, more than double from 34 percent in 2012. Compared to developed economies, this is still a moderate level.
However, the situation is aggravated by large amounts of debt held by state-owned companies, which have often taken up debt under the supervision of local governments. Total debt of the non-financial sector in China reached more than 300 percent in the first quarter of 2023. This is a comparatively high level and was only surpassed by a few highly indebted jurisdictions such as Japan and Hong Kong.