There have been regular concerns around the scale and complexity of China’s debt in recent years. From 2012 onwards, China’s debt to GDP ratio ballooned, as uncontrolled growth in the country’s shadow banking sector swelled credit issuance. Starting in 2016, Chinese authorities began to address these debt concerns, starting the deleveraging program that was intended to control and reduce risks in the financial sector. However, priorities now appear to be shifting as policy makers attempt to support an economy negatively impacted by trade tensions with the United States.

For further details, please see the NAB China Economic Update – August 2019