More than 80% of local government financing vehicles do not have enough operating cash to cover interest payments on their debt, says UBS estimates. These entities are state-owned companies set up to finance infrastructure projects including highways and bridges.
Premier Li Keqiang’s address to Chinese officials shows Beijing is ramping up efforts to prevent a recession, analysts say, but there will be no immediate change to the zero-Covid policy that has hammered business.
China’s local governments are pulling out all the stops to lure investment – especially in advanced technology – amid mounting economic challenges, including a slowdown in the property market.