China Must Use Policy Might Against Virus, Former Adviser Says
- Debt battle can wait, says Chinese Academy’s Yu Yongding
- Losses should be borne by all society, not just producers: Yu
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China should shelve its “critical battle” against financial risks and consider absorbing the losses of small enterprises hit by the new coronavirus, said a former central bank adviser.
The government should cut interest rates, rethink its growth target for this year and use an even more expansionary fiscal and monetary policy than ordinarily needed to reach 6% annual growth, said Yu Yongding. Banks should roll over loans and postpone repayments if necessary to allow enterprises to survive this crisis, he said.
“Debt, inflation, bubbles -- those are secondary” problems, said Yu, 72, a member of the government’s elite Chinese Academy of Social Sciences think tank in Beijing. “We can worry about this later when everything has calmed down.”