China Unveils $1.4 Trillion Debt Swap, Saves Stimulus for Trump
- Officials stopped short of providing stimulus to boost demand
- Beijing retains fiscal room to respond to any Trump trade war
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China gave indebted local governments a 10 trillion yuan ($1.4 trillion) lifeline but stopped short of unleashing new stimulus, preserving room to respond to a potential trade war when Donald Trump takes office next year.
Officials unveiled details of a program to refinance “hidden” local debt onto public balance sheets at a press briefing in Beijing on Friday. Funds for that program — telegraphed last month but without a price tag or timeframe — will be provided through 2028, they said, after the move was authorized by the nation’s top lawmaking body.