Large stimulus "detrimental" to growth, Xinhua says

The state-run Xinhua News Agency published an editorial Wednesday saying that stimulus packages, akin to those implemented in 2008, are no longer able to support China’s economic growth in a sustainable fashion, Bloomberg reported. “Many have expected the government to announce an aggressive plan, similar to the 4-trillion-yuan (US$632 billion) stimulus package issued in 2008, to keep the economy from stalling for a second time,” Xinhua, which is often viewed as an official voice of the government, said. “However, a massive stimulus plan is not only unlikely, but would be detrimental to the country’s sustainable growth.” The 2008 measures have already resulted in high local-government debt and increased risk of loan defaults, as well as failing to promote rebalancing, Xinhua said. Measures will now focus on reviving the private sector with planned tax cuts.