In this issue, we examine the massive RMB 4 trillion stimulus package the Chinese central government announced last year as part of its efforts to boost the domestic economy. The new plans provides for increased infrastructure projects including railway and power plant construction, water resource management, environmental protection, and initiatives to aid China's large rural population. We also examine some of the tax reforms and subsidies the government has introduced in an effort to keep the growth rate above 8 percent. China is intent on spending all of the RMB 4 trillion within the next two years and the effect that this huge stimulus will have on the nation is likely to be profound.
