BEIJING — China's fiscal stimulus is losing its effectiveness and is more of a strategy to buy time for industrial and consumption policies, S&P Global Ratings senior analyst Yunbang Xu said in a report Thursday.
The analysis used growth in government spending to measure fiscal stimulus.
"In our view, fiscal stimulus is a buy-time strategy that could have some longer-term benefits, if projects are focused on reviving consumption or industrial upgrades that increase value-add," Xu said.
The head of the top economic planning agency said in March that China would "strengthen macroeconomic policies" and increase coordination among fiscal, monetary, employment, industrial and regional policies.
High debt levels limit how much fiscal stimulus a local government can undertake, regardless of whether a city is considered a high or low-income region, the S&P report said.
Persons:
Yunbang Xu, Xu
Organizations:
Global
Locations:
Nanning, Guangxi Zhuang, China, BEIJING, Shenzhen, Bazhong, Sichuan