Bank adviser: Fiscal policies have bigger role to play

Fiscal policies, particularly value-added tax cuts, will play a greater role in supporting the economy compared to monetary tools as China needs to stick to its deleveraging efforts, a central bank adviser said.

"Downside risks brought by external challenges will put pressure on both the monetary and fiscal policy fronts," Ma Jun, a People's Bank of China adviser, told China Daily.

"But the space on the monetary side is limited as we need to stick to efforts to promote deleveraging moves, while room for fiscal expansion remains ample - more tax cut policies can help to soothe economic concerns, in particular value-added tax," he said.