China Eyes Debt Overhaul: A Bold Move to Boost Economic Growth

Chinese lawmakers are reviewing a cabinet bill aimed at raising local government debt ceilings to replace hidden debt, in response to ongoing economic challenges. The decision is expected this Friday as part of broader fiscal strategies to reignite growth, amidst geopolitical pressures.

In a significant move to address economic challenges, Chinese lawmakers are examining a cabinet proposal to increase local government debt limits, replacing existing hidden debts. Xinhua reported on this development as part of the Standing Committee of the National People's Congress's key agenda this week.

Minister of Finance Lan Foan, representing the State Council, presented the bill, highlighting its potential to alleviate the heavy burden of local government debt on investment and growth. Xu Hongcai of the NPC Financial and Economic Affairs Committee provided insights on the review of the proposal.

Amid economic slowdown due to a prolonged property market slump and massive local debt, China is poised to approve over 10 trillion yuan in new debt issuance this week. Sources indicate that a robust fiscal package could be introduced, especially if Donald Trump secures a second U.S. presidency.

(With inputs from agencies.)