China’s much vaunted Rmb4,000bn economic stimulus package is being delayed by local governments unable to raise their share of financing, according to a report from the state auditor.

The survey, published yesterday, is the first official indication that China’s stimulus measures have not been as effective as the government claims.

The auditor said that, in some cases, local governments had stumped up less than half the funds they had promised for projects in their jurisdictions, even though Beijing had transferred 94% of the money earmarked by the central government for the stimulus plan.

The news comes as some economists question the efficacy of these measures in putting the country on a sustainable growth path that relies less on overstretched western demand for cheap Chinese exports.

Financial Times