China's Debt Interest Costs Hit 19.2% of Budget, Overtaking the US Amid Growth Struggles
Updated
Updated · Yahoo Finance · Oct 11
China's Debt Interest Costs Hit 19.2% of Budget, Overtaking the US Amid Growth Struggles
3 articles · Updated · Yahoo Finance · Oct 11
Summary
Interest payments now absorb 19.2% of China’s central government general public budget, up from 12% in 2014 and above the U.S. share of 14%.
A 341% jump in debt-servicing costs between 2013 and 2025 made interest the fastest-growing major budget item as Beijing borrowed heavily to support slowing growth.
China’s economy is weakening on several fronts: GDP is tracking below its 4.5%-5% target, consumer spending and investment remain soft, and the property sector is still recovering from a deep crash.
Credit strains are building as state-backed lending to priority sectors swells business debt—up twofold since 2019—while revenues rose only 30% and nearly a third of firms are losing money.
The contrast with the U.S. is widening: America’s own interest bill has surged to $1 trillion, but stronger growth, low unemployment and AI-led investment are helping sustain its debt load.