China Provinces’ 2026 Budgets Show Modest Revenue Growth, Targeted Spend in Uncategorized 16/02/2026 China’s major provinces’ 2026 budgets signal targeted, policy-directed fiscal spending rather than a broad-based local investment push to offset softer growth, Fitch Ratings says. This is in line with our view that domestic demand weakness will lower China’s GDP growth to 4.1% in 2026, from 5.0% in 2025. We expect local governments’ (LRGs) to keep investments targeted in 2026, with provinces leaning on special-purpose bonds to fund strategic infrastructure and support investment in high-tech and advanced manufacturing, underpinning industrial upgrading and the broader economic transition. Economy-wide fixed-asset investment fell by 15.1% yoy in December 2025, driven by declines in private-sector and property investment. The decline was despite local-government investment, including via local-government financing vehicles, with LRGs maintaining capex growth of 5.3% yoy during 2025. We believe local governments will prioritise debt control rather than pursue rapid expansion in infrastructure investment to prop up growth. A sustained rebound in land purchases is unlikely in the near term, keeping LRGs’ capital revenue weak or flat in many provinces and constraining government-fund spending growth. This means any material capital spending uplift would depend on additional policy support such as a larger local-government bond quota or central transfers to expand bond-financed investment under a broad stimulus mandate, which is not in our base case. Central government support is, therefore, likely to remain a key backstop to help LRGs meet investment needs and support spending needs for weaker regions. Operating budgets point to subdued revenue momentum. Major provinces are budgeting 2%–3% growth in 2026 general public budget operating revenue, broadly in line with 2025’s 2.4% but below gross regional product growth targets. LRG operating revenue growth is likely to remain in the low single digits in 2026, broadly in line with our national 4.1% real GDP forecast. Execution risk remains, given persistent weak domestic demand and deflationary pressures. Operating spending discipline is also likely to persist, despite the Ministry of Finance’s indications to increase fiscal spending in 2026. We expect modest expenditure growth for LRGs’ general public budgets, which only grew by 0.2% in 2025, as LRGs maintain tight control of discretionary expenditure and prioritise targeted policy areas. Priorities include public welfare, investments in human capital such as education, healthcare and social security, and measures to support domestic demand, including equipment upgrades and the consumer goods trade-in scheme. In this context, we expect LRG public-sector debt to rise moderately in 2026. A sharper-than-expected increase in borrowing to fund investments, without a matching improvement in revenues, would add to medium-term fiscal pressure and weaken credit fundamentals. Source: Fitch Ratings 2026-02-16 hellenicshippingnews... window.___gcfg = {lang: 'en-US'}; (function(w, d, s) { function go(){ var js, fjs = d.getElementsByTagName(s)[0], load = function(url, id) { if (d.getElementById(id)) {return;} js = d.createElement(s); js.src = url; js.id = id; fjs.parentNode.insertBefore(js, fjs); }; load('//connect.facebook.net/en/all.js#xfbml=1', 'fbjssdk'); load('https://apis.google.com/js/plusone.js', 'gplus1js'); load('//platform.twitter.com/widgets.js', '