Finance minister says economy is not overheating and high inflation unlikely Finance Minister Jin Renqing has announced a 283.7 billion yuan fiscal surplus in the first 11 months. He also asserted the mainland's economy was not overheating and that he did not expect inflation to rise strongly. 'There's no strong signal that high inflation will hit the country in the near term,' Xinhua quoted Mr Jin as saying at a national meeting on financial measures. The overheating problems being dealt with by the central government for almost a year were structural in nature and some sectors, such as agriculture, education, public health and social welfare, were still in need of support. 'Therefore, it would not be appropriate to make an about-face on the current fiscal policy and turn abruptly from expansionary to restrictive [measures],' Mr Jin said yesterday. He said the stable financial policy officially announced as a guideline for next year at the national economic summit two week ago would not be a straightjacket. Also, the country's sound financial shape would assist a smooth transition to fiscal moderation. The budget surplus stood at 283.7 billion yuan for the January-November period, Mr Jin was quoted as saying. Revenue for the first 11 months rose 23.5 per cent year on year to 2.44 trillion yuan, an increase of 465.6 billion yuan over the same period of last year. Expenditure went up 14.1 per cent to 2.16 trillion yuan during the period, 266.2 billion yuan more than a year ago. Mr Jin said he expected full-year government revenue to hit about 2.6 trillion yuan. At the start of this year, the central government had set the 2004 deficit target at 319.8 billion yuan, or 2.5 per cent of gross domestic product (GDP). Mr Jin said the central government would reduce the fiscal deficit and the size of treasury bonds by an appropriate degree next year. It was earlier reported that Beijing had planned to reduce its budget deficit to 300 billion yuan, or 2 per cent of GDP, next year in its transition from an expansionary fiscal policy to a stable one. Policymakers have yet to announce the size of special bond issues for next year, but analysts have said they expect the amount to be cut to 80 billion yuan, compared with 110 billion yuan this year. Beijing issued a cumulative 910 billion yuan in special bonds between 1998 and last year for infrastructure projects to spur growth. Mr Jin also revealed at the meeting that inflationary pressure - which has been building up since the end of last year - had made the central government think twice about its proactive fiscal policy. Consumer prices recorded increases of more than 5 per cent for three straight months in the second half of the year.