BEIJING - CHINA will give its neediest citizens handouts of up to 180 yuan (S$39) each to brighten their mood before the Chinese New Year, a festive occasion that has been marred by the economic downturn.

The Ministry of Finance announced the one-off payment totalling about US$1.3 billion (S$1.9 billion) on its website yesterday. It also said the money would help stimulate domestic consumption.

The payouts, ranging from 100 to 180 yuan each, would go mainly to laid-off workers and veteran Communist Party members living in strained financial circumstances.

Overall, the government said it would distribute 9 billion yuan to about 74 million citizens.

According to local media, this is the first time the Chinese government is distributing cash payouts on such a large scale.

The ministry added that the money must reach the people before the Chinese New Year, also known as the Spring Festival, which begins on Jan 26 this year, and is traditionally a time for buying new clothes and gifts for the family.

The Civil Affairs Ministry also said that China was committed this year to increasing welfare payments for the country's poorest.

Rising unemployment has fed Beijing's fears of unrest as the country's economy slows abruptly after nearly two decades of sizzling growth.

REUTERS