Salient to Investors:

Ding Shuang at Citigroup said China’s fiscal policy will be neutral in Q4 as spending won’t be higher than a year earlier – policy effects from previous months will ensure a modest recovery, but the rebound is restrained.

Professor Song Guoqing at Peking University said the fiscal money left for spending in the coming months is actually very limited and puts a question mark on whether the present economic recovery will be sustained. Song said China’s annual budget report usually underestimates actual fiscal revenue growth to allow the government to spend a lot approaching year-end.

Wang Tao at UBS said most of the infrastructure investment is not financed explicitly by fiscal resources or on the budget but through other means, like bank lending and bond sales.

Joy Yang at Mirae Asset Securities (HK) Ltd said the economy will grow 8.3 percent in 2013.

Feng Xingyuan at Unirule Institute of Economics said local governments in China are not allowed to carry budget deficits, so have to scramble for funds when they are short of money, and increasing levies on businesses has become an easy option for some, which is bad for the real economy.

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