On October 18, 2023, in Beijing, China, to commemorate the tenth anniversary of the “Belt and Road” initiative, a Chinese flag flew on the roof of the Great Hall of the People before the opening ceremony of the “Belt and Road” Summit Forum.
Sue Edgar | Reuters
BEIJING – A closely watched meeting of China’s National People’s Congress Standing Committee on Monday considered a proposal to increase local government debt limits. official media.
The new debt will be used to replace hidden debt, the report said, noting that Finance Minister Lanfouyan spoke about the plan at the meeting.
Lan said at a news conference last month that raising the local debt limit was in the works. China’s local governments have historically been responsible for the majority of public service expenditures, but financial difficulties As revenue from land sales to developers fell.
Lu Ting, chief China economist at Nomura Securities, said China has about 50 trillion to 60 trillion yuan (about 7 trillion to 8.45 trillion U.S. dollars) of outstanding implicit debt.
He estimated in a report on Friday that about 10 trillion yuan in additional debt lines may be approved in the next few years to replace some of the hidden debt.
“If China’s economy faces greater challenges, Beijing may eventually increase the debt swap to 15 trillion yuan,” Lu said.
The Standing Committee of China’s National People’s Congress holds a meeting this week Approval of further financial support is widely expected for the country’s economic slowdown. Committee Chairman Zhao Leji will chair the meeting, which is scheduled to end on Friday.
