How can a government save, if it has deficit?

Question

I am reading an IMF paper about China's debt (link) which says:
❝ Despite a large augmented fiscal deficit of 10 percent, fiscal savings remain higher than other countries, resulting from the biased composition of spending towards investment ❞
How can a government have deficit and at the same time have positive savings?

1muflon1 · Answer

Government can have savings while having deficit because we are just talking about savings not net savings.
For example, imagine that government has zero tax revenue $\$10$ spending and $\$10$ of public investment. In this case the government is running deficit of $\$20$ yet it is also saving through investment. Due to the deficit being larger than saving on net basis government still dis-saves but saving is not zero.
So it is completely possible to save and run a deficit at the same time.

How can a government save, if it has deficit?

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