Beijing stimulus plan held up(losing steam)

Reuters ^ | 05/19/09 | Jamil Anderlini

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Beijing stimulus plan held up

By Jamil Anderlini in Beijing

Published: May 19 2009 03:00 | Last updated: May 19 2009 03:00

China's much vaunted Rmb4,000bn economic stimulus package is being delayed by local governments unable to raise their share of financing, according to a report from the state auditor.

The survey, published yesterday, is the first official indication that China's stimulus measures have not been as effective as the government claims.

The auditor said that, in some cases, local governments had stumped up less than half the funds they had promised for projects in their jurisdictions, even though Beijing had transferred 94 per cent of the money earmarked by the central government for the stimulus plan.

The news comes as some economists question the efficacy of these measures in putting the country on a sustainable growth path that relies less on overstretched western demand for cheap Chinese exports.

Central government has pledged Rmb1,200bn

[TigerLikesRooster]

When the news of big stimulus package first came out, there were reports that Chinese gov relabeled many local public work projects which were already cleared to go, and announced them as part of their new stimulus package. I guess they have funding trouble even for the package which is actually a lot smaller than they announced.

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Ping!