China rejects IMFs $1 trillion housing rescue plan

Chinese authorities have rejected a proposal made by the International Monetary Fund to use central government funds to complete unfinished housing, dealing a blow to hopes for more forceful support to an industry that's been a major drag on the economy.


The IMF called on China to deploy "one-off" fiscal resources to complete and deliver pre-sold properties or compensate homebuyers, according to an annual review of the its economy published on Friday. It put the cost at 5.5% of GDP over four years. That would amount to almost $1 trillion based on last year's GDP, according to Bloomberg calculations.



"We Should continue to apply market-based and rule-of-law principles in completing and delivering these units," said Zhang Zhengxin, the IMF's executive director for China. Bloomberg