Since the 2008 financial crisis, Chinese economic policymakers have been grappling with rising debt amid worries about slowing growth momentum. The front line of this battle is fought by local government officials, who must juggle the conflicting targets of reducing public sector borrowing and ensuring that China hits the central government's goal of doubling gross domestic product in the decade to 2020.
To this end, the Chinese government has so far relied on a massive expansion of credit. Most observers however, including Chinese policymakers and academics, believe a new approach is needed to keep GDP growing. In 2016, a 25 trillion yuan ($3.68 trillion) increase in new credit in the economy resulted in a mere 6 trillion yuan increase in GDP.