1. China’s Economy: More Debt than Meets the Eye
- Author:
- Antonio Graceffo
- Publication Date:
- 11-2022
- Content Type:
- Journal Article
- Journal:
- China Brief
- Institution:
- The Jamestown Foundation
- Abstract:
- Since the beginning of this year, investment banks and international financial organizations, including the International Monetary Fund and the World Bank, have steadily downgraded their forecasts for the People’s Republic of China’s (PRC) GDP growth in 2022 to around 3.2 percent (Nikkei Asia, October 7). Most analysts agree that Beijing is in a difficult economic position, but the situation has the potential to become far worse due to off-balance sheet liabilities. Such debt risks defaulting, or may otherwise need to be covered by the central government. Another drag on the country’s balance sheet that has yet to fully hit home is the impact of Belt and Road Initiative (BRI) financing. Due to economic problems and debt crises in BRI partner countries, a large percentage of the initiative’s loans may have to be forgive or at least restructured. Before looking at its financing and hidden liabilities, it is necessary to establish an overall picture of the current PRC economy across a broad spectrum of indicators.
- Topic:
- Debt, Economy, Economic Growth, Belt and Road Initiative (BRI), and Investment
- Political Geography:
- China and Asia