China’s hidden local government debt equates to half of GDP – Goldman Sachs

Goldman Sachs economists said in their latest report, China’s hidden local government debt has ballooned to half the size of the country’s Gross Domestic Product (GDP), per Bloomberg.

Key quotes

“Total debt of local government financing vehicles rose to about 53 trillion yuan ($8.2 trillion) at the end of last year from 16 trillion yuan in 2013.”

“That’s equal to about 52% of gross domestic product and is larger than the amount of official outstanding government debt.”

“More official local government bond issuance and increased flexibility on local government financing are probably needed to support overall economic growth.”