In a recent interview with ChinaPerspectives, Zhang Bin, a senior researcher at the China Finance 40 Forum and a national political adviser, said that there remains room for relaxing the definition of new implicit local government debt, which is strictly prohibited, to accommodate more project investments aimed at enhancing public welfare and boost government expenditures.

“If our urgent task at present is to increase aggregate demand, it is important to properly handle the pace of debt reduction,” said Zhang, who is also deputy director of the Chinese Academy of Social Sciences’ Institute of World Economics and Politics.

Dong Yilang contributed to this story.