From CNBC: 2024-11-04 19:49:40

China’s parliament committee reviews proposal to raise local government debt limit. Finance Minister Lan Fo’an spoke at the meeting, indicating an increase was in the works. Local authorities have struggled financially due to drop in revenue from land sales. Estimated 10 trillion yuan in additional debt quota could be approved over the next few years to replace hidden debt.

China has around $7 trillion to $8.45 trillion in outstanding hidden debt. Nomura’s chief China economist Ting Lu estimates that Beijing might eventually raise the debt swap to $2.2 trillion if the economy faces bigger challenges. The National People’s Congress is expected to approve further fiscal support for the slowing economy during the week.

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