China says proactive fiscal policy does not mean opening floodgate of stimulus

[BEIJING] China's finance minister said on Thursday that a proactive fiscal policy does not mean Beijing will open a floodgate of stimulus, adding that authorities are highly concerned about local government debt risks.

China will not allow new hidden debt and strictly forbids illegal financing guarantee offered by local governments, said finance minister Liu Kun at a news conference on the sidelines of an annual parliamentary meeting in Beijing.

Policymakers are ramping up support for the economy after growth last year cooled to a 28-year low, but analysts do not expect activity to stabilise until around mid-year.

REUTERS