4 February 2021
In November 2008 a panicked Chinese government launched a stimulus package equivalent to 12% of then GDP. The package propelled China out of the GFC, but it created more problems than it solved, e.g.:
- A tenfold increase in corruption
- Useless or non-economic projects: “bridges to nowhere”
- A surge in banks’ bad loans
- A sharp increase in the ratio of debt to GDP
- Unsafe buildings, and highways that collapsed