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The expansion is mainly aimed at reducing costs for firms, and should not be interpreted as strong stimulus, Huang said.

Lou made similar remarks during the G20 Finance Ministers and Central Bank Governors Meeting last week, when he predicted an increase in China's budget deficit this year.

China has well over 200 million people aged 60 or above, more than 15 percent of the population, and the figure is expected to reach 243 million by 2020. Geriatric care lags far behind demand and varies greatly between regions.

We will actively promote reforms of the fiscal and financial systems. For example, business tax will be replaced with VAT in all sectors, a major step of structural reform that will save businesses more than RMB500 billion in tax. This will not only help us form a consistent tax system and eliminate double taxation. More importantly, it will strongly boost the development of the service industry, especially high-end services, such as R&D, and support the transformation and upgrading of the manufacturing sector. Most enterprises will benefit from the tax reduction to varying degrees, and small and micro businesses will see their tax burden significantly lightened. In times of fiscal difficulties, the government is doing this to release more water to nourish the fish in the pond, i.e. to generate continued momentum of growth with a short-term drop in fiscal revenue. It is also indicative of the room for fiscal flexibility left at our disposal. Let me give you another example. For reforms in the financial sector, we can explore market-based approaches for debt-for-equity swap to help lower corporate leverage ratio.

She asked foreign media to take note of other countries' deployment of radars and advanced weapons on China's islands in the South China Sea, and make objective, fair and calm reports.