China faces a nearly $1 trillion funding gap. It will need more debt to fill it. - 0 views
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The Chinese government faces a growing shortfall of cash, analysts say, as they predict an increase of debt to fill the gap.The analysts did not share specific figures on how much additional debt might be needed. But they pointed to growing pressure on growth that would require more support from deb
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BEIJING — The Chinese government faces a growing shortfall of cash, analysts say, as they predict an increase of debt to fill the gap.“The latest wave of Omicron and the widespread lockdowns in place since mid-March have resulted in a sharp contraction in government revenue, including land sales revenue,” Ting Lu, chief China economist at Nomura, and a team said in a report last week.
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“Much of the incoming ‘stimulus measures’, be it special government bonds or incremental lending by policy banks, will be merely used to fill this funding gap,” the Nomura analysts said.
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