Oct 29 – China is considering approving next week the issuance of over 10 trillion yuan in extra debt in the next few years to revive its fragile economy, two sources with knowledge of the matter said. The fiscal package is expected to be further bolstered if Donald Trump wins the Nov. 5 presidential election, the sources said.
Here are some comments from analysts on the stimulus plans:
TOMMY XIE, HEAD OF GREATER CHINA RESEARCH, OCBC BANK, SINGORE
“The current policy priorities appear to focus first on addressing local government hidden debt, followed by financial system stability, and then on supporting domestic demand.
“My key concern was: how will the debt swap be financed? If local governments primarily finance the swap, converting hidden debt into on-balance-sheet obligations may reduce interest expenses. However, this approach alone may not increase…
