The Flanders-China Chamber of Commerce and KBC Group are pleased to invite you to an In-person event which will take place on November 16, 2023 at 17h30 CET, at the KBC Arteveldetoren, Maaltekouter, 9051 Gent.
Our distinguished speaker, Mr. Hans Dewachter, Chief Economist, KBC Group, will deliver a speech focussing on "China's Unique 'Recession'".
China may not be in a technical recession, but the real estate crisis, which is compounding the problem of a highly indebted household sector with limited appetite for consumption, has kicked up fears of a balance sheet recession. The usual policy prescription for a balance sheet recession, which is stronger fiscal stimulus to counter private sector deleveraging, requires nuance in China's case. With China's SOEs and LGFVs already over-indebted, appropriate fiscal stimulus needs to come from the central government, and needs to target the household sector and private enterprises. Hence, the government does have the tools available to mitigate spillovers from the real estate sector, but the question remains of whether or not they will follow through.