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Analysts warn more detail needed on new China economic measures

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Analysts gave a cautious welcome to China’s announcement Saturday of fresh fiscal stimulus to revive its ailing economy but warned that more details — and specific headline figures — were needed before its effect could be fully assessed.

At a highly anticipated news conference, Beijing said it would issue special bonds to boost the capital available to banks, as well as allow local governments to borrow more.

The moves add to a series of measures unveiled in recent weeks that have included interest rate cuts and liquidity injections for banks, all aimed at kick-starting China’s dragging economy.

Leaders said recently that the government’s official growth target for this year of about five percent was within reach.

But economists have warned that a robust fiscal stimulus programme is necessary in order to boost domestic spending and achieve the full post-pandemic recovery that has so far eluded policymakers.

‘Devil in details’

“The surprise today is that there is no specific number,” Heron Lim of Moody’s Analytics told AFP after the Saturday press conference, saying it looked like the government was “still working on the minute details of the fiscal stimulus”.

“Unfortunately for China, the devil is in the details. It would be preferable that they do have some headline numbers for people to chew on,” he added.

“In the meantime, investors might be taking a step back until they are absolutely certain of the direction fiscal support is taking.”

Although Saturday’s news conference did not unveil a “bazooka” stimulus package, which investors have been clamouring for, comments by officials on expanding central support for the economy received some praise.

Finance Minister Lan Fo’an said the government was “accelerating the use of additional treasury bonds, and ultra-long-term special treasury bonds are also being issued for use”.

The debt ceiling of local governments would also be increased, in theory empowering them to spend more on infrastructure and protect jobs.

“These policies are in the right direction,” said Pinpoint Asset Management’s Zhang Zhiwei in a note.

“While (Lan) didn’t say explicitly that they will raise fiscal deficit, I think his comments imply that it is possible the government will raise fiscal deficit above three percent for next year,” he wrote.

Such a move would represent a “meaningful shift” in Beijing’s fiscal policy approach, said Zhang, helping to “boost domestic demand and mitigate the deflationary pressure in the economy”.

But the impact of new policies on China’s broader economic outlook will depend on their “size and composition” — again, details that have yet to be announced — he said.

Long-term change ahead?

A major focus of Saturday’s news conference was the government’s efforts to shield local authorities from spiralling debt that could have negative spillover into the economy.

Xing Zhaopeng, senior China strategist at ANZ, said the messaging showed officials were focused on “derisking local governments”.

A new quota for treasury and local bonds, as well as a debt swap programme that could reach 10 trillion yuan ($1.42 trillion) in the coming years, is expected, he said.

Such moves would represent “long-term and structural change”, Xing added, noting that “local governments are the growth drivers in China”.

Other headwinds — including sluggish consumption and high youth unemployment — threaten to dampen economic vitality.

“Fiscal commitment needs to be more robust to offset the drag from households and the private corporate sector,” Gary Ng, senior economist at Natixis, told AFP.

Beijing had not yet decided on the size of its eventual fiscal stimulus package, said Ng, “meaning the impact on growth will depend on whether such announcements are enough to boost confidence.

“More needs to be done regarding implementation and injecting actual new fiscal money.”

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North Korea joined Russia in its war against Ukraine, Zelenskyy says

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North Korean leader Kim Jong Un, background attends a leaving ceremony at the main train station in Vladivostok, Russia © Alexander Khitrov/Copyright 2019 The AP. All rights reserved
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North Korea is supplying Russia not only with weapons but also with people, including those employed in Russian factories, Ukraine’s President Volodymyr Zelenskyy said, urging Ukraine’s partners to increase their support.

And with reports of North Korean boots on the ground, in fact, Pyongyang has actually entered the war against Ukraine.

“In the coalition of criminals alongside Putin, North Korea is already involved, specifically the Kim family, which enslaves over 20 million people in North Korea,” Zelenskyy stated, addressing the Parliament in Kyiv on Wednesday.

“Our intelligence has observed not only the transfer of weapons from North Korea to Russia but also the transfer of individuals. These individuals are workers sent to Russian factories to replace those killed in the war, as well as personnel for the Russian army.”

And it’s not just Pyongyang, it’s also Tehran, according to Zelenskyy.

“Everyone sees its regime’s support for Putin,” he said.

Why would Russia need North Korean soldiers, and where?

Ukrainian outlet The Kyiv Independent, citing Western sources, reported that North Korea has sent 10,000 soldiers to Russia to boost its war efforts against Ukraine.

Furthermore, the Russian 11th Airborne Brigade is forming a 3,000-person “battalion” staffed with North Korean citizens, according to Ukrainian outlets Suspilne and Liga, citing anonymous military intelligence sources.

Where could they be deployed?

Ukrainian intelligence sources assessed that this “battalion” will likely be involved in ongoing Russian defensive operations in the Kursk region.

Earlier, the Ukrainian partisan movement claimed that it had identified the presence of North Korean military personnel in training areas located close to Mariupol.

Euronews could not independently verify these claims.

The US-based ISW think tank says it has recently observed reports that a small contingent of North Korean personnel was operating near occupied Donetsk City.

The Kremlin is likely leveraging the Russia-North Korea comprehensive strategic partnership agreement made in June, in part to offset Russian force generation and border security requirements, according to the ISW.

This might help further cement Russian President Vladimir Putin’s commitment to avoiding mobilisation for as long as possible.

“Putin appears more willing to absorb North Korean personnel into the Russian military and resort to other irregular force generation efforts than to call for a wider mobilisation to actually address the combat situation,” ISW added.

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Vice President Shettima Mourns Lives Lost in Jigawa Tanker Tragedy, Pledges Federal Govt’s Support

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Vice President Shettima
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In the wake of a catastrophic tanker explosion in Jigawa State that claimed over 100 lives, Vice President Kashim Shettima has announced immediate federal government intervention and called for a comprehensive review of fuel transportation safety protocols across Nigeria.

The Vice President on behalf of President Bola Ahmed Tinubu expressed particular sorrow for the families who lost loved ones in this tragic incident and prayed that Almighty Allah grants them the fortitude to bear the loss.

In a condolence message on Wednesday, VP Shettima said “My heart aches for those who have had their families torn apart by this disaster.”

“This devastating incident has shaken us all to our core. The Federal Government stands with the people of Jigawa. We are mobilising all necessary resources to support the injured and assist the families affected by this calamity,” he said.

The tragedy, which occurred in Majiya has thrown the entire nation in grief. In response, the Vice President has directed the immediate deployment of the National Emergency Management Agency (NEMA) personnel and resources to Jigawa State.

“As we contend with this tragedy, let us also reflect on the importance of safety measures and public awareness to prevent such incidents in the future,” Shettima emphasised.

“Every life is precious, and we must do all we can to protect our citizens.”

The Vice President also commended first responders and medical personnel for their tireless efforts, stating their dedication “exemplifies the best of our nation’s spirit.”

VP Shettima had inaugurated the National Road Safety Advisory Council (NaRSAC) last Friday with a charge on members to align with global best practices in reducing traffic crashes.

He tasked the council to set National Road Safety Strategy targets and ensure effective coordination between federal, state, and local governments to achieve shared road safety objectives.

Vice President Shettima emphasised the critical nature of road safety, stating, “Road safety is not merely a matter of policy but a critical part of the lifeline that connects the people of this nation.”

Stanley Nkwocha
Senior Special Assistant to The President on Media & Communications
(Office of The Vice President)
16th October, 2024

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Tanker fire: President Tinubu sends high-level delegation to Jigawa 

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Jigawa Tanker Fire
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President Bola Tinubu has directed the Secretary to the Government of the Federation (SGF), Senator George Akume, to lead a Federal Government delegation to Jigawa in response to Tuesday night inferno in Majia town, which claimed over 100 lives.

The government delegation will comprise the Minister of Defence, Mohammed Badaru Abubakar; Minister of Transportation, Senator Saidu Alkali; Corps Marshall of the Federal Roads Safety Commission (FRSC), Mr Shehu Mohammed; and the Senior Special Assistant to the President on Community Engagement (North West), Abdullahi Tanko Yakasai.

Disclosing this in a statement on Wednesday, the Special Adviser to the President on Information and Strategy, Bayo Onanuga, said that while in Jigawa, the delegation will visit the scene of the incident to assess the situation and visit injured persons in the hospital.

READ ALSO: 140 Victims Of Jigawa Tanker Explosion Buried, 90 In Hospitals

According to him, Tinubu further directs that emergency aid, including medical supplies, food, and shelter, be extended to the 50 victims receiving treatment and others affected by the fire.

“The President, with a heavy heart, joins the Vice President in extending his deepest condolences to the families of the victims of this devastating incident.

“He expresses his heartfelt prayers and support to the government and people of Jigawa during this time of tragic loss and grief.

“He prays for divine comfort for the bereaved families and the peaceful repose for the souls of the departed,” the statement read in part.

Onanuga added that Tinubu reassured the nation that the Federal Government, in collaboration with states, is committed to the swift and comprehensive review of fuel transportation safety protocols across the country.

He restated his directive to the Federal Roads Safety Corps (FRSC) to strengthen night travel measures, such as increased patrols, stricter enforcement of safety regulations, and other highway safety mechanisms.

He said those found responsible for breaches of safety standards will be held accountable, reaffirming the government’s unwavering commitment to ensuring such incidents do not recur.

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