Government spending up 25% in August but RMB1tn goes unused

Fiscal stimulus spending in China rose 25.9% in August year over year, pushing fiscal expenditures to more than RMB10 trillion (US$1.57 trillion) for the year to date, up 14.8% compared to the first eight months of 2014, Reuters reported, citing new figures from the Ministry of Finance. The August leap was the biggest rise since April, when spending jumped 33%. But central government authorities have seized RMB1 trillion from local governments who have failed to use their budget allocations, according to sources, pointing to ongoing difficulties in turning higher spending into actual activity as previously strong growth sectors suffer from overcapacity.