China's government has sounded a sanguine note about GDP growth at the close of its Economic Work Conference. Monetary policy will remain "prudent" and fiscal policy "proactive" in 2014. In practice, these labels don't mean much. But with policy continuity the watchword, the government is signalling that its attention will be on reform.
Perhaps most significant is the mention of a need to deal with local government debt. Alongside further financial sector liberalisation, budgetary reform is now at the topic of the reform agenda. Local governments are likely to face greater oversight of borrowing in future, limiting their ability to stoke local growth and helping to reduce over-investment.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services