China: new support measures deemed inadmissible! Is the worst to be feared?

In the midst of a real estate crisis, China announced new economic support measures on October 12. However, these announcements, considered vague and insufficient, left investors wanting more, raising concerns about their effectiveness in reviving the country's economy.

China economy

China: investors worried about support measures! The worst could happen

On October 12, China announced a series of economic measures intended to support its struggling economy, mainly affected by a persistent real estate crisis. Finance Minister Lan Fo'an detailed several key initiatives. Among these, increased support for local authorities to reduce their debt, the issuance of Treasury bills to strengthen the capital of public banks, and the use of funds allocated to local authorities to stabilize the real estate market.

In addition, specific measures aim to support students in order to stimulate domestic consumption. These announcements come against a backdrop of economic slowdown, with growth forecast for 2024 at just 4.8%, one of the lowest rates in decades.

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Measures that seriously worry investors

Despite the scale of the measures announced, investors remain skeptical about their effectiveness. The South China Morning Post reports that many were hoping for more concrete actions and precise figures to reassure the markets. The absence of numerical details in Lan Fo'an's statements reinforced these doubts.

According to economist Xu Tianchen, this imprecision is due to the fact that the exact amounts still need to be approved by the Standing Committee of the National People's Congress. As a result, investors fear that these measures will not be enough to resolve the structural problems of the Chinese economy and sustainably revive growth.

Finally, although China has announced ambitious economic support measures, their lack of clarity and precision has left investors skeptical. The economic situation remains fragile, and the effectiveness of these initiatives to sustainably revive growth remains to be proven in the months to come.

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