China posts fiscal surplus of $124 billion

China reported a fiscal surplus of 807 billion yuan ($124 billion) in the first quarter of 2011 as brisk economic growth and rising prices drove up government revenues, the Ministry of Finance said on Friday. That surplus amounted to 8.4 percent of China's gross domestic product in the first quarter, well above the government's target for a fiscal deficit of 2 percent of GDP in 2011.
However, the Chinese government's spending pattern in previous years is to run a huge deficit in December, wiping out surpluses accumulated in the first 11 months to pull the entire budget into the red for the year. Government revenues rose 33 percent in the first three months to 2.6 trillion yuan compared to a year ago, while state expenditure climbed 26 percent to 1.8 trillion yuan, the ministry said. A strong economy, rising prices that boosted corporate tax receipts, income carried over from last year and the inclusion of off-budget items such as land sales revenues all helped to lift government revenues, the ministry said. March data suggested that to be true. Revenues grew 27 percent that month from a year ago, down from an annual rise of 36 percent in the first two months.