"A lot of what has been built has been incredibly useful. Since the Global Financial Crisis, China's economic performance has been underpinned by a debt-fuelled building frenzy – some of it good, some of it bad – McMahon argues. That construction boom has taken up the slack after exports ceased to be the key driver of Gross Domestic Product. While living there, McMahon focused on deciphering the inner workings of China's financial system and the political economy which underpins it, and now his investigations have become the book China's Great Wall of Debt.ĭespite China's growing middle class, massive volume of exports and monumental infrastructure projects, the country faces a number of economic threats, he tells Kathryn Ryan, and it's unclear how it can be transformed by 2020 as President Xi Jinping has urgently requested.Īccess to debt has kept the Chinese economy powering along on all cylinders and allowed for the massive levels of construction, says McMahon, who now works for a China-focused thinktank in Chicago. Listen to the full interview with Dinny McMahonĬhina's opaque financial system is a mystery to most outsiders, says McMahon, who worked in China for ten years at The Wall Street Journal and the Dow Jones Newswires.
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