Goodbye, China Deleveraging. Onward Belt and Road?
Asian allies can expect sweeter terms as Beijing’s focus switches to growth.
More where that came from: a belt-and-road project in Sri Lanka.
Photographer: Atul Loke/BloombergWith China’s fiscal, monetary, currency and credit policies all taking a pro-growth turn, President Xi Jinping’s deleveraging campaign is clearly over. Or, at the very least, it’s going into the freezer for as long as there’s no letup in trade tensions with the U.S.
But what about Xi’s other pet idea? In Southeast Asia, the ambitious belt-and-road project witnessed a 36 percent year-on-year decline in investment commitments and construction contracts in the first half. The setback is temporary, according to Citigroup Inc., which expects Beijing will yield to its partners’ concerns for the sake of its “overarching geostrategic imperatives.”