Local governments plan to keep tightening their belts

China’s provincial governments have now concluded the annual meetings at which they set economic targets and lay out fiscal plans. They anticipate slower GDP growth this year and plan to continue with local austerity. Fortunately, the central government will likely step in to prevent fiscal tightening at the national level. And while major stimulus isn’t on the cards, local officials do at least seem to be shifting their focus toward supporting consumption.