Finance Minister Lan Fo’an said at a press conference Friday that borrowing capped at 6 trillion yuan ($838 billion) would be allowed over three years to help regional governments replace their so-called “hidden debt.” This kind of debt is normally owed by risky local government financing platforms, backed by cities or provinces.

Lan added that local governments will be given access to a separate 4 trillion yuan ($558 billion) quota in the form of special local bonds over five years, also with the aim of trimming their debt holdings. The announcement was made at the conclusion of a five-day meeting by China’s top legislative body, the Standing Committee of the National People’s Congress (NPC).

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Source: https://www.cnn.com/2024/11/08/business/china-economy-hidden-debt-intl-hnk/index.html

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The economic rebound seen earlier this year has lost momentum in the second quarter, prompting China’s central bank to cut some key interest rates this week for the first time in nearly a year, with expectations of more to come.

“The post-Covid recovery appears to have run its course, an economic double dip is nearly confirmed, and we now see significant downside risks to our below-consensus GDP growth forecasts of 5.5% and 4.2% for 2023 and 2024, respectively,” analysts at Nomura said in a research note after the latest disappointing data.

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Source: https://www.reuters.com/world/china/chinas-economy-slows-further-may-weak-demand-drags-2023-06-15/

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