“China will “significantly increase” government debt issuance to offer subsidies to people with low incomes, support the property market and replenish state banks’ capital as it pushes to revive sputtering economic growth.
“There is still relatively big room for China to issue debt,” he said
Chinese stocks reached two-year highs, spiking 25% within days since that meeting, before retreating as nerves set in given the absence of further details on the government’s additional spending plans.
Reuters reported last month that China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of fresh fiscal stimulus.
Most of China’s fiscal stimulus still goes into investment, but returns are dwindling and the spending has saddled local governments with $13 trillion in debt.
Lan said Beijing will support local governments to resolve their debt issues, adding that they still have a combined 2.3 trillion yuan ($325.5 billion) to spend in the last three months of this year, including debt quotas and unused funds.
Separately, Bloomberg News reported that China is also considering injecting up to 1 trillion yuan ($142 billion) of capital into its biggest state banks to increase their capacity to support the economy, primarily by issuing new sovereign bonds.”
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“China will “significantly increase” government debt issuance to offer subsidies to people with low incomes, support the property market and replenish state banks’ capital as it pushes to revive sputtering economic growth.
“There is still relatively big room for China to issue debt,” he said
Chinese stocks reached two-year highs, spiking 25% within days since that meeting, before retreating as nerves set in given the absence of further details on the government’s additional spending plans.
Reuters reported last month that China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of fresh fiscal stimulus.
Most of China’s fiscal stimulus still goes into investment, but returns are dwindling and the spending has saddled local governments with $13 trillion in debt.
Lan said Beijing will support local governments to resolve their debt issues, adding that they still have a combined 2.3 trillion yuan ($325.5 billion) to spend in the last three months of this year, including debt quotas and unused funds.
Separately, Bloomberg News reported that China is also considering injecting up to 1 trillion yuan ($142 billion) of capital into its biggest state banks to increase their capacity to support the economy, primarily by issuing new sovereign bonds.”