China’s Debt Mountain Is Even Bigger Than Feared
The city center at night in Hegang, northeast China. Hegang drew headlines when it revealed debt of more than double its fiscal income—representing the tip of the iceberg of a local government debt problem that threatens to be a drag on the world’s second-largest economy for years to come.
Photograph: Bloomberg
Japan’s descent into stagnation is an infamous economic tale known around the world. But at its start, in the early 1990s, it wasn’t abundantly clear what was happening to what was then the world’s No. 2 economy.
Much to the frustration of Japan’s Ministry of Finance, there was a coterie of keen financial analysts who warned that the country’s debt problem was a whole lot worse than advertised, and that economic growth wasn’t going to magically make it go away.