In China, economic activity in manufacturing has continued to be sluggish, but that in nonmanufacturing has remained robust (Chart 6). Spending by local governments was one of the reasons for the sluggishness of the Chinese economy in the first half of this year.
However, the pace of spending increases has accelerated recently, partly as a result of instructions by the central government and measures to facilitate the financing of local governments (Chart 7). With these initiatives taking effect, China’s economic growth is expected to accelerate from the end of 2015 to early 2016.