China’s Politburo Ignites Talk About $220 Billion More in Debt
- Top leaders ask provinces to better use existing debt limit
- New special notes may go through approval in August: analyst
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China’s local governments may have more money to spend this year after the nation’s top leaders urged better use of the existing debt ceiling limit, with some analysts estimating the unused amount could be as high as 1.5 trillion yuan ($220 billion).
Provinces will be supported to “make full and better” use of the ceiling on how much special debt they can take on, the Politburo, the Communist Party’s top decision-making body, said Thursday. The debt is mostly comprised of special local government bonds and is mainly used to pay for infrastructure spending, an area China is relying on to drive its Covid and property crisis-hit economy this year.