China’s effort to move mountain of ‘hidden debt’ faces uphill climb

BEIJING - As China’s economic growth gets back on track after three years of the Covid-19 pandemic, efforts to tackle the mountain of

so-called “hidden debt” accumulated by local governments

have re-emerged as a priority on the agendas of top policymakers.

Fresh concerns have mounted that weakening income growth and rising spending over the past few years may force local authorities to resort to new off-the-book borrowing, while limiting their ability to pay down the debt. These liabilities are estimated by some to be almost US$10 trillion (S$13.4 trillion), roughly double the gross domestic product (GDP) of Japan, the world’s third-largest economy.