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China urgently needs to tackle its corporate-debt problem before it becomes a major drag on growth in the world’s No. 2 economy. Corporate debt has reached very high levels and continues to grow. In our recent paper, we recommend that the government act promptly to adopt a comprehensive program that would sacrifice some economic growth in the short term while rapidly returning the economy to a sustainable growth path.
Filed under: Asia, banking, China, Debt Relief, Economic research, Financial regulation, growth, IMF, International Monetary Fund, Public debt | Tagged: Asia, banking, China, corporate debt, credit gap, credit risks, debt relief, deleveraging, Financial regulation, IMF, iMFdirect blog, investment, Japan, Spain | Leave a comment »