Asia

Debt-heavy municipalities represent a major risk to the world’s second-largest economy and its financial stability, amid a deepening property crisis China’s cabinet is to restrict 12 heavily indebted regions from taking on new debt and will also limit what new state-funded projects they can launch as Beijing bids to defuse its local government debt-risk time bomb. The dozen regions, which cover a wide swathe of the nation, will only be allowed to take on specified projects, such as those approved by the central government, sources said. Other projects, such new railway stations and power plants, will not be allowed. The sources were citing a cabinet document dated late September that was delivered to local governments and state lenders this month. The order also specifies that...

Russia’s brutal invasion has driven millions into poverty and debilitated – but not quite destroyed – Ukraine’s economy. Meanwhile, sanctions are straining the Russian economy, but they are yet to end a war that has sown financial turmoil and personal hardship in the region and across the globe. It was clear from the start that Putin’s war in Ukraine would be a global economic disaster. Its economic impacts may be insignificant next to the suffering and loss of life on the battlefields. But they do present critical challenges that leaders must resolve to limit yet more suffering through poverty, food shortages and the cost of living crisis. To illuminate these challenges, Economics Observatory has been publishing expert insights on the war’s economic implications ever since Rus...

Millions of migrants, who helped transform China from an agrarian economy into a manufacturing giant, are living pitiable lives. While lucrative work opportunities start dwindling fast after the workers turn 35 years of age, at the same time, most end up working well past the statutory retirement age to make ends meet. China’s economic transformation could well be considered the widest expansion of its kind in modern history. In 1979, former leader Deng Xiaoping opened up the country to foreign investors and set up four special economic zones – Shenzhen, Zhuhai and Shantou in Guangdong province, and Xiamen in Fujian. Hundreds of millions of workers then flocked to coastal factories in search of a good life. Low-cost Chinese products flooded the world, thanks to the labour of these m...

China’s parliament is set to approve just over 1 trillion yuan ($137 billion) in additional sovereign debt issuance when it concludes a five-day meeting on Wednesday China is set to boost fiscal spending – and issue more debt – to shore up its shaky economic recovery. Some government advisers are recommending that financial policymakers lift the 2024 budget deficit target beyond the 3% of gross domestic product (GDP) set for this year. That will allow Beijing to issue more bonds to revive the economy, policy insiders and economists have said. The move would draw on a well-used playbook that relies heavily on debt and state spending but falls short on the deeper reforms called for by a growing number of analysts. The world’s second-largest economy grew faster than expected i...

China’s parliament is set to approve just over 1 trillion yuan ($137 billion) in additional sovereign debt issuance when it concludes a five-day meeting on Wednesday China is set to boost fiscal spending – and issue more debt – to shore up its shaky economic recovery. Some government advisers are recommending that financial policymakers lift the 2024 budget deficit target beyond the 3% of gross domestic product (GDP) set for this year. That will allow Beijing to issue more bonds to revive the economy, policy insiders and economists have said. The move would draw on a well-used playbook that relies heavily on debt and state spending but falls short on the deeper reforms called for by a growing number of analysts. The world’s second-largest economy grew faster than expected i...

People’s Bank of China governor Pan Gongsheng says risk monitoring will be stepped up, after debt problems manifested at major developers Evergrande and Country Garden Policymakers are also urged to tailor policies to the different market realities in various Chinese cities The cabinet’s finance work report to China’s top legislature over the weekend could signal that policymakers are racing to defuse widely watched risk points such as mounting debt in the world’s second-largest economy, analysts say as the woes of ailing developers and a local-level debt debacle continue to erode investor confidence. Chinese authorities will prioritise the tackling of key risks to defend their bottom line of no systemic risks, and this will include restructuring small financial instit...

In an interview, UAE ambassador to India Abdulnasser Alshaali said that India, Europe, and the Middle East MoU for the India-Middle East-Europe Economic Corridor could potentially reduce shipping costs and facilitate efficient trade in goods and services. NEW DELHI : India and the United Arab Emirates are looking to identify and incorporate commodities to diversify trade between the two countries, UAE ambassador to India 8said in an interview. The diversification of traded commodities can broaden the scope of economic cooperation and make local currency transactions even more versatile, Alshaali said in an email interview. He added that India, Europe, and the Middle East MoU for the India-Middle East-Europe Economic Corridor (IMEC) could potentially reduce shipping costs and facilitate...

Officials have inspected Foxconn sites in four provinces, while state media says founder Terry Gou has ‘responsibilities’ and should be pushing for peace with Beijing as he runs for president in Taiwan Officials in China have inspected factories in Guangdong and Jiangsu provinces set up by Taiwan’s Foxconn, plus subsidiary businesses on the mainland for what state media says is a tax and land-use audit. Foxconn, which is the largest supplier of Apple iPhones, and some of its key subsidiaries are suspected of violating laws and regulations, Chinese media reported on Sunday. Officials from China’s natural resources department also conducted on-site investigations on the land use of Foxconn enterprises in Henan and Hubei provinces, the nationalist tabloid the Global Times repor...