MNI China Press Digest, Nov 14: Fiscal, Deficit, Overcapacity

     BEIJING (MNI) - The following lists highlights from the Chinese press for

Wednesday:

     China's October fiscal revenue fell year-on-year for the first time this

year, weighed by tax and fee cuts, as well as VAT reform, Xinhua news agency

said late Tuesday, citing Zhang Lianqi, a fiscal and taxation expert. Fiscal

revenue was CNY1.572 billion in October, down 3.1% y/y on October 2017, with tax

revenue down by 5.1% y/y to CNY1.346 billion, Xinhua said, citing Finance

Ministry data. (Link to the story: https://bit.ly/2DCRO4T)

     China's fiscal deficit rate should be increased to 4%, The Paper said

Wednesday, citing Yao Yudong, former director of the Financial Research

Institution of The People's Bank of China on Tuesday. Chinese small and

medium-size banks have insufficient collateral to apply to the Medium-term

Lending Facility (MLF), so liquidity released by the central bank can't reach

the real economy. A 4% deficit rate is reasonable and can mitigate the risk of a

lack of collateral, the newspaper said citing Yu. (Link to the story:

https://bit.ly/2DCX1Kf)

     China is expected to meet its target of cutting at least 500 million tons

of coal production capacity and 150 million tons of crude steel capacity two

years ahead of schedule, the Economic Information Daily (Xinhua news subsidiary)

said Wednesday citing an anonymous insider. Along with its campaign to cut

overcapacity, China is also facing the problem of insufficient supply of future

capacity, EID said. Therefore, the total capacity to be reduced next year will

be lowered and the campaign will focus on structural optimization of production

capacity, as the government aims to gradually replace the obsolete capacity with

advanced ones, the newspaper said. (Link to the story: https://bit.ly/2DkKKJu)

--MNI Beijing Bureau; +86 (10) 8532-5998; email: wanxia.lin@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: M$A$$$,M$Q$$$,MBQ$$$]