Over the weekend China’s new finance minister Lan Foan was cited ass saying China will accelerate the issuance and use of government bonds.
The report came via state-run news agency Xinhua.
The fin min added:
- finance ministry will steadily promote the resolution of local government debt risk and increase efforts to better leverage the role of special bonds to boost the economy
- will continue to implement a proactive fiscal policy
- focus on improving efficiency
- better play the effectiveness of fiscal policy
- some new local government debt quotas for 2024 have been issued in advance to reasonably ensure local financing needs
Alos from China, Zhang Bin, deputy director of the Institute of World Economics and Politics at The Chinese Academy of Social Sciences (CASS) says China should
- expand government debt
- boost credit
in order to drive the growth of financial assets in society, which in turn will increase nominal income and help restore consumption in the short term.
Sounds good, I wonder how quickly Chinese people will respond to … more debt.