China Set to Approve $1.4 Trillion Fiscal Stimulus Package Amid Economic Struggles

China is looking at a big stimulus package to help boost its struggling economy. Reports suggest that the country might approve a fiscal stimulus of 10 trillion yuan, or about $1.4 trillion, as soon as next week.

They plan to raise new debt in the coming years. This will involve issuing special sovereign treasuries and local government bonds. Sources say that China aims to collect 6 trillion yuan, which is around $840 billion, over the next three years. This money will help local governments tackle hidden debts.

Additionally, China plans to raise another 4 trillion yuan, or $560 billion, to support its shaky property sector. In June, many banks in China had to shut down. They were taken over by larger institutions due to a significant downturn in the real estate market. The situation got worse because of poor risk management and rising local government debt.

Next week, China’s national legislature, known as the Standing Committee of the National People’s Congress, will meet to decide on this stimulus package. It’s a crucial moment for the country as it seeks to stabilize its economy.