1China’s Macroeconomy in 2011 1
1.1China’s Economic Aggregate in 2011 3
1.1.1Product Market 3
1.1.2 Financial Market 7
1.1.3 Factor Market 15
1.2 China’s Macroeconomic Structure in 2011 16
1.2.1Industrial Structure 16
1.2.2 Regional Structure 21
1.2.3 Demand Structure 22
1.2.4 Distribution Structure 27
1.3 Hot Issues and Major Macroeconomic Policies 30
1.3.1Inflation 30
1.3.2 Real Estate Regulation and Control 32
1.3.3 Private Entrepreneurs’ “Running Away” 37
1.3.4 International Mergers and Acquisitions by Chinese Enterprises 39
2 China’s Fiscal Revenue in 2011 42
2.1Review of Fiscal Revenue during the “Eleventh Five-year Plan” Peri-od 42
2.2 Analysis of Total Fiscal Revenue in 2011 45
2.2.1Fiscal Revenue Budget for 2011 45
2.2.2 Fiscal Revenue Implementation in 2011 46
2.2.3 Major Reasons for National Revenue Accomplishment in 2011 47
2.3 Analysis on the Structure of China’s Fiscal Revenue in 2011 48
2.3.1Breakdown of Fiscal Revenue by Month 48
2.3.2 Breakdown of Fiscal Revenue by Province 50
2.3.3 Breakdown of Fiscal Revenue by Category 52
2.4 Analysis of Treasury Bonds Issuance in 2011. 55
2.4.1The Volume of Central Government Debt and Its Risks in 2011 57
2.4.2 Structure of Treasury Bonds Outstanding in 2011 58
2.4.3 Types of Treasury Bonds Issued in 2011 59
2.4.4 Local Government Bonds Issued in 2011 61
2.5 Analysis of Hot Tax Policies in 2011 63
2.5.1Pilot house property tax 63
2.5.2 Adjustment of individual income tax 65
2.5.3 The new policy on vehicle and vessel tax 68
2.5.4 The pilot program for replacing business tax with VAT launched in some industries in Shanghai 70
2.5.5 Reform of Resource Tax 73
3 China’ s Fiscal Expenditure in 2011 76
3.1Review of Fiscal Expenditure during the “Eleventh Five-year Plan” Period 76
3.2 Analysis of Total Fiscal Expenditure in 2011 78
3.2.1Implementation of Fiscal Expenditure Budget 78
3.2.2 Annual Growth of Fiscal Expenditure 79
3.2.3 Comparison with Fiscal Revenue Growth 80
3.2.4 Comparison with GDP Growth Rate 81
3.3 Analysis on the Structure of Fiscal Expenditure in 2011 83
3.3.1Breakdown of Fiscal Expenditure by Month 83
3.3.2 Breakdown of Fiscal Expenditure by Item 84
3.3.3 Breakdown of Fiscal Expenditures by Central and Local Govern-ment Spending 88
3.4 Major Items of Fiscal Expenditure in 2011 89
3.4.1Education Spending 90
3.4.2 Spending on social security and employment 93
3.4.3 Spending on Water Conservancy 95
3.4.4 Spending on the “Three Public Consumptions” 98
4 Analysis of China’s Fiscal System 114
4.1Fiscal System before the Tax-sharing System 114
4.1.1Highly centralized fiscal system before the reform and opening-up 114
4.1.2 “Substitution of Tax Payment for Profit Delivery” and Fiscal Responsibility System after China’ s Reform and Opening-up 116
4.2 Tax-sharing System Reform in 1994 118
4.2.1Division of Administrative Power and Expenditures between Cen-tral and Local Governments 120
4.2.2 Division of Fiscal Revenue between Central and Local Govern-ments 120
4.2.3 Transfer Payment System of the Central Finance 122
4.3 Further Improvements of the Tax-sharing System 124
4.3.1Strengthening the balancing function of the central finance and clarifying the service function of grass-roots and local govern-ments 125
4.3.2 Attaching great importance to scientific and precise fiscal manage-ment in accordance with the law 132
4.3.3 Gradually moving toward democratic and transparent fiscal super-vision 133
Appendix The Ways in which the Reform of “Placing County Finances under Direct Provincial Administration” Promotes County-level Economic Growth 134
References 152