Financial juggernaut China Development Bank is spearheading a government-backed drive by the country’s three policy lenders to stimulate economic growth through stealth, the South China Morning Post reports. The government is deploying the lenders to make low-profile, targeted cash infusions into specific areas, rather than adjusting monetary and fiscal levers in headline-grabbing maneuvers that affect the whole economy. And unlike listed state-owned commercial banks that have to keep an eye on the bottom line and answer to investors and auditors, policy lenders can put their full loan weight behind state or local government goals. The finance ministry, which has budgeted a fiscal deficit of 3% for this year and is in the process of swapping local government debt into bonds, is reluctant to embrace all-out stimulus.
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