A Quick Summary
China is considering issuing over 10 trillion yuan ($1.4 trillion) in extra debt over the next few years to support its struggling economy, a move that could be further expanded if Donald Trump wins the U.S. election, as the country grapples with a prolonged property sector crisis and rising local government debt.
China is considering approving next week the issuance of over 10 trillion yuan ($1.4 trillion) in extra debt in the next few years to revive its fragile economy, a fiscal package which is expected to be further bolstered if Donald Trump wins the U.S. election, two sources with knowledge of the matter told Reuters.
Why it matters
The planned total amount, to be raised by issuing both special treasury and local government bonds, equates to over 8% of the output of the world’s second-largest economy, which has been hit hard by a protracted property sector crisis and ballooning debt of local governments.
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