Recently, the “2018 China Enterprise Credit Development Forum and the 9th Public Welfare Ceremony for Integrity” were held in Beijing.
He Zhen, former Deputy Chairman of the NPC Financial and Economic Committee, said in a speech at the forum that China’s local debt is estimated to be about 40 trillion yuan ($6.24 trillion). Although the scale is still within the acceptable range, none of the local governments want to repay their debts. “Now, if you want someone to repay these debts, he will say that we don’t even have the money to pay wages; we are having big financial difficulties. What are we going to do? Therefore, regarding those debts that are owed at present, before any mention is made about paying down the principal, they can’t even pay the interest that is due.”
He believes that China has issued too much currency. The data shows that, at the end of 2017, M2 was 167.68 trillion yuan , ($26.158 trillion), which is 25 percent of what China’s GDP was that year and is higher than any other country in the world.
At another conference, Li Ruogu, President of the China Export-Import Bank, expressed his views on China’s external situation. He specifically mentioned that the U.S.’s judgment about China has undergone a fundamental change. Sino-U.S. trade friction is essentially a controversy on the direction of China’s development.
Li Ruogu said that Sino-U.S. relations will not continue along the path they have taken over the past 40 years. Specifically, in the United States, no matter what party or class, most of them advocate a tough attitude towards China. This allows the U.S. to move beyond the partisan line on its China strategy and operate quickly and effectively.
Source: Duowei News, May 22, 2018