TACKLING CHINA'S LOCAL-GOVERNMENT DEBT MAY HURT NATION'S GROWTH, CICC SAYS
Bloomberg News, June 28, 2010
China’s efforts to contain the risks from a surge in local-government debt may hurt growth in the world’s third-biggest economy, investment bank China International Capital Corp. said.
A report by the chief auditor last week indicated officials may take “relatively forceful measures” including strictly controlling new borrowing, CICC economists led by Hong Kong- based Ha Jiming said in a report today. The effect may be to “limit the source of funding for infrastructure projects and affect future economic growth.”
Chinese policy makers are grappling with the risks posed by the credit boom that fueled the nation’s comeback from the global recession. Fitch Ratings says lenders’ weakened financial positions as asset quality deteriorates could limit the nation’s ability to respond to any renewed global slump with more stimulus measures.
Bloomberg News, June 28, 2010
China’s efforts to contain the risks from a surge in local-government debt may hurt growth in the world’s third-biggest economy, investment bank China International Capital Corp. said.
A report by the chief auditor last week indicated officials may take “relatively forceful measures” including strictly controlling new borrowing, CICC economists led by Hong Kong- based Ha Jiming said in a report today. The effect may be to “limit the source of funding for infrastructure projects and affect future economic growth.”
Chinese policy makers are grappling with the risks posed by the credit boom that fueled the nation’s comeback from the global recession. Fitch Ratings says lenders’ weakened financial positions as asset quality deteriorates could limit the nation’s ability to respond to any renewed global slump with more stimulus measures.
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