China’s credit-fuelled economic strategy has been branded as dangerous by the International Monetary Fund in a strongly-worded statement warning that its approach risks financial turmoil. The IMF used its annual health check on the world’s second biggest economy to stress that faster expansion in 2017 was coming at the cost of a jump in private sector debt and an increasing use of complex financial instruments. While the IMF increased its forecast for Chinese expansion in 2017 from 6.2% to 6.7%, it stressed that this was the result of the authorities in Beijing putting a higher priority on hitting a growth target than on the quality of the economic output.
