By Jacob L. Shapiro
Indeed, it seems the government was the last to admit as much. In June, the Institute of International Finance published data indicating that China’s debt-to-GDP ratio had reached 304 percent. In July, Moody’s downgraded its view of the Chinese banking system from stable to negative. In September, Standard & Poor’s downgraded China’s sovereign debt rating because China was not deleveraging as quickly as expected. Then in October, the International Monetary Fund released a report that identified China’s financial system as having “elevated financial stability risks,” the implications of which could be global. Clearly there is more than meets the eye in China’s positive economic performance in 2017.
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