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China’s National People’s Congress Is Expected to OK Fiscal Stimulus. Will It Be Enough?

Capital Economics’ China Economist Leah Fahy, in a note to clients, says the bulk of any fiscal packages approved are likely to be focused on local government debt. Local governments have been struggling with hefty debt loads because the revenue they typically received from land sales has dried up as the property market has slumped. That has been a problem for the economy because local governments have typically been the vehicle for stimulus.

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