In a move to revive its economy, China today pledged to “significantly increase” debt but did not disclose the size of this stimulus package. In a press conference, Finance Minister Lan Foan said that Beijing would help local governments tackle their debt problems, offer subsidies to people with low incomes, support the property market and replenish state banks’ capital, among other measures.
But Lan’s omission of the size of the package is likely to prolong investors’ nervous wait for a clearer policy roadmap until the next meeting of China’s legislature, which approves extra debt issuance. A date for the meeting has yet to be announced but it is expected in the coming weeks.
The new fiscal stimulus had been the subject of intense speculation in global financial markets after a September meeting of the Communist Party’s top leaders, the Politburo, signalled an increased sense of urgency about the economy.
