Core Points - The core viewpoint of the article is the election of Sanna Takashi as the first female president of Japan's ruling Liberal Democratic Party (LDP), which positions her as a strong candidate for the upcoming prime ministerial election [1][2]. Group 1: Political Background - Sanna Takashi was born in 1961 in Nara Prefecture and entered politics in 1993 as a member of the House of Representatives. She has held various significant positions, including Minister of Economic Security and Minister of Internal Affairs [1]. - Takashi is closely associated with former Prime Minister Shinzo Abe and is considered a staunch supporter of the "Abe line," having first entered the cabinet during Abe's first term in 2006 [1]. Group 2: Prime Ministerial Election Prospects - The prime ministerial election is expected to take place on October 15, with the LDP currently holding a minority in both houses of the National Diet. This situation could allow opposition parties to potentially unite against the LDP [2]. - Takashi has stated that dissolving the House of Representatives for early elections is unlikely due to pressing issues such as rising prices, indicating a focus on immediate economic challenges [2]. Group 3: Policy Positions - Takashi is known for her right-wing conservative stance, advocating for the restoration of traditional Japanese values, constitutional reform, and enhanced national security [3]. - In economic policy, she emphasizes "active fiscal policy," proposing tax cuts and increased local financial support to address inflation [3]. - On foreign policy, she aims to continue Abe's "Free and Open Indo-Pacific" strategy and strengthen cooperation with ASEAN and Global South countries [3]. - In security matters, she proposes enhancing the Self-Defense Forces and improving the treatment of self-defense personnel, while not ruling out increased defense spending at the request of the U.S. [3]. - Takashi's immigration policy focuses on stricter control of illegal immigrants and careful scrutiny of foreign capital inflows [3]. - Her historical perspective is notably right-leaning, with a long-standing practice of visiting the Yasukuni Shrine, which could create diplomatic tensions in East Asia if she continues this practice as Prime Minister [4].

Core Insights - The article emphasizes the urgency of accelerating the replacement of existing hidden debts by local governments in the second half of the year, suggesting that the total debt replacement quota should be utilized sooner rather than later [1][2][4] Group 1: Debt Replacement Progress - In the first half of the year, local governments issued approximately 22,607 billion yuan in government bonds for debt replacement, accounting for about 81% of the total annual quota of 28,000 billion yuan [1][3] - The issuance of refinancing special bonds for debt replacement reached about 17,900 billion yuan, representing approximately 90% of the planned 20,000 billion yuan quota [3] - The rapid issuance of bonds in the first quarter reflects the government's commitment to debt replacement, which has alleviated fiscal pressure and allowed for more funds to be directed towards economic development [3][4] Group 2: Challenges and Policy Responses - Despite progress, local governments face challenges in debt replacement due to sluggish tax revenue growth and a significant decline in land transfer income [2][4] - A new policy package introduced by the central government aims to issue a total of 10 trillion yuan in special bonds from 2024 to 2028 to replace existing hidden debts, thereby extending repayment periods and reducing interest burdens [2][6] - The Ministry of Finance plans to issue 2.8 trillion yuan in special bonds for debt replacement in 2025, including 2 trillion yuan in refinancing bonds and 800 billion yuan in new special bonds [2] Group 3: Future Recommendations - Experts recommend that local governments should expedite the issuance of new special bonds for debt replacement, ensuring that the annual debt replacement targets are met [6][7] - There is a call for a comprehensive assessment of local government debts, including those not currently classified as hidden debts, to better understand the actual debt pressure faced by local governments [7][8] - The transformation of local government financing platforms is crucial, with suggestions to enhance their market competitiveness and reduce reliance on local government support [5][8]

Manufacturing Sector - The manufacturing PMI for June 2025 is 49.7%, an increase of 0.2 percentage points from the previous month[4] - In June, 11 out of 21 surveyed industries are in the expansion zone, an increase of 4 industries compared to last month[6] - Large enterprises' PMI is 51.2%, up 0.5 percentage points, while small enterprises' PMI is 47.3%, down 2.0 percentage points[11] Supply and Demand - The production index and new orders index are at 51.0% and 50.2%, respectively, both showing increases of 0.3 and 0.4 percentage points[15] - The supply and demand index has rebounded, aligning with seasonal trends, with certain industries like food and beverage showing expansion[15] - Non-metal mineral products and black metal smelting industries continue to contract due to insufficient end demand from the real estate sector[15] Price Index and Procurement - The main raw material purchase price index and factory price index are at 48.4% and 46.2%, both rising by 1.5 percentage points[20] - The procurement index has increased to 50.2%, up 2.6 percentage points, indicating a rise in enterprise procurement activity[21] Non-Manufacturing Sector - The service sector's business activity index is at 50.1%, a slight decrease of 0.1 percentage points, indicating stability[24] - The construction sector's business activity index is 52.8%, up 1.8 percentage points, showing a seasonal rebound but with notable sub-sector differentiation[26] Risks - External disturbances and changes in real estate demand pose risks to the overall economic outlook[30]

Core Viewpoint - After the weakening of tariff frictions, the manufacturing sector shows signs of stabilization, although industry differentiation has intensified, indicating ongoing pressure in the real estate sector [1]. Manufacturing Sector - In June 2025, the manufacturing PMI was 49.7%, an increase of 0.2 percentage points from the previous month, reflecting a seasonal rebound [2]. - The purchasing index rebounded, suggesting that enterprises are gradually adapting to external disturbances, shifting from cautious expansion to a more positive outlook for future production [2]. - There is a notable divergence between large and small enterprises, with large enterprises continuing to expand while small enterprises are further contracting [2]. Supply and Demand - The overall supply and demand index in June showed a seasonal recovery, with certain industries like food, beverages, and specialized equipment in the expansion zone [3]. - The recovery in supply and demand is attributed to the easing of tariff frictions and the positive impact of fiscal policies, particularly in equipment renewal [3]. - Conversely, industries such as non-metallic mineral products and black metal smelting continue to experience contraction due to insufficient end-demand driven by real estate pressures [3]. Price Index - The manufacturing price index increased in June, primarily driven by rising oil prices due to tensions in the Middle East, while the price index for the black metal smelting industry continued to decline [3]. Non-Manufacturing Sector - The service sector's business activity index slightly decreased to 50.1%, indicating stability, but several industries, including retail and transportation, fell below the critical point after the May Day holiday effect faded [3]. - The construction sector showed a seasonal rebound, with civil engineering activities remaining robust, although demand for commercial housing was weak in the second quarter, potentially dragging down overall construction sentiment [3]. Policy Outlook - With the easing of tariff frictions, addressing low inflation internally is crucial. The government plans to issue the third batch of funds for the old-for-new consumer goods program in July, with expectations for positive policy effects [4]. - Future macroeconomic policies are likely to remain proactive, with a steady and loose monetary policy and accelerated fiscal measures anticipated [4].

Revenue Insights - In the first four months of 2025, the national general public budget revenue was 80,616 billion yuan, a year-on-year decrease of 0.4%[6] - In April 2025, the monthly revenue growth rate was 1.9%, up from 0.3% in March[6] - Tax revenue for the same period was 65,556 billion yuan, with a year-on-year decline of 2.1%[8] Expenditure Insights - General public budget expenditure from January to April 2025 was 93,581 billion yuan, reflecting a year-on-year growth of 4.6%[9] - In April 2025, the expenditure growth rate was 5.8%, slightly higher than March's 5.7%[9] - Social security and education expenditures maintained high growth rates, indicating a focus on welfare[11] Government Fund Insights - Government fund budget revenue decreased by 6.7% year-on-year to 12,586 billion yuan in the first four months of 2025[17] - In April 2025, the revenue growth rate rebounded to 8.1%, compared to -11.7% in March[17] - Government fund budget expenditure grew by 17.7% year-on-year, with April's growth rate reaching 44.7%[17] Fiscal Policy Outlook - The fiscal policy is expected to accelerate, focusing on urban renewal projects and infrastructure improvements[22] - There is an emphasis on increasing local government special bonds and long-term special treasury bonds to support economic growth[22] - Risks remain due to uncertainties in overseas demand, which could impact future fiscal performance[23]

报告导读： 4月财政收支增速边际回升，反映经济韧性。二季度或主要加快落实存量政 策，关注城市更新项目的进展以及两新政策的力度。 狭义收入：增速继续回升。 2025 年 1-4 月，全国一般公共预算收入同比下降 0.4% ，但是 4 月当月增 速 1.9% ，相比 3 月的增速 0.3% 有所回升。在海外不确定性扰动、我国 PPI 价格低位运行的情况下， 4 月财政收入增速回升反映了积极财政发力后，经济表现出一定的韧性。从主要分项看，增值税、消费 税、企业所得税收入增速边际回落。个人所得税收入增速明显回升。此外，出口退税增速虽然边际回落， 但是表现尚可，或与出口受转口贸易的支撑有关。接下来，随着关税局势缓和，外需或边际回升。此外， 非税收入增速持续回落，可能对地方收入有所拖累。 狭义支出：增速平稳，保障民生。 2025 年 1-4 月，全国一般公共预算支出同比增长 4.6% ，其中从 4 月当月同比增长 5.8% ，相比 3 月的增速 5.7% 略微抬升。从节奏看，目前支出进度与过去两年的同期 水平大体相当。这体现出，财政政策仍较为积极，对经济保持应有的支持力度。 政府性基金：收入回升，支出提速。 2025 年 ...

Revenue Summary - In the first quarter, the national general public budget revenue was 60,189 billion yuan, a year-on-year decrease of 1.1%, with the decline narrowing by 0.5 percentage points compared to January-February. March saw a monthly increase turning positive [1] - Tax revenue for the first quarter was 47,450 billion yuan, down 3.5% year-on-year, while non-tax revenue was 12,739 billion yuan, up 8.8% year-on-year [1][3] - March's general public budget revenue increased by 0.3% year-on-year, accelerating by 1.9 percentage points compared to January-February, primarily driven by a narrowing decline in tax revenue [1][3] Expenditure Summary - In the first quarter, national general public budget expenditure reached 72,815 billion yuan, a year-on-year increase of 4.2%, with March's growth accelerating to 5.7% [2] - The expenditure progress for the first quarter was 24.5%, higher than the average of 23.7% over the past five years, indicating a continuation of proactive fiscal measures [2] - Major expenditure areas included social security and employment at 13,570 billion yuan (up 7.9%), education at 11,249 billion yuan (up 7.8%), and health at 5,848 billion yuan (up 2.2%) [5] Tax Revenue Performance - In March, major tax revenues showed improvement, with VAT increasing by 4.9% year-on-year, and corporate income tax rising by 16.0%, indicating potential marginal improvement in corporate profitability [4] - Non-tax revenue growth was driven by dividends from central financial enterprises and local asset management, with a year-on-year increase of 8.8% [4] - The significant decline of 58.5% in personal income tax was attributed to the timing of year-end bonuses and a high base from the previous year [4] Government Fund Overview - In the first quarter, government fund budget revenue was 9,247 billion yuan, down 11% year-on-year, while expenditure was 19,769 billion yuan, up 11.1% [6] - Revenue from state-owned land use rights fell by 15.9% to 6,849 billion yuan, with related expenditures also declining by 11% [6]

广 发证券资 深宏观分析师 吴棋滢 wuqiying@gf.com.cn 广发宏观郭磊团队 报告摘要 第一， 一季度狭义财政收支分化。一般公共预算收入同比-1.1%，其中税收收入同比-3.5%，和去年全年的-3.4%大致相当，可能部分与PPI及名义增长中枢依然有 待提升有关；但支出同比达4.2%，显示出积极财政的特征。今年以来支出的主要拉动来自普通国债（非特别国债）节奏的显著前置，1-3月普通国债进度达30%左 右，为近年同期的最高水平。 第二， 一季度广义财政同样呈收支分化特征。政府性基金收入同比-11%、支出同比11.1%，收支差1万亿元，高于2024年，反映了广义财政托底较去年更加积极。 我们理解可能一则有去年底未使用完毕的超长期特别国债和专项债资金在今年年初形成支出；二则尽管用于"两新""两重"的超长期特别国债还未发行，中央已提前 安排了"两新"预拨付资金810亿元用于以旧换新、"两重"资金2300亿元用于项目建设，可在一季度形成支出。 第三， 从3月单月情况来看，较1-2月有边际好转。狭义财政一般公共预算收入当月同比0.3%，较前值-1.6%有所回升；其中税收收入同比-2.2%，较前值的-3.9%亦 ...