Steady Path Ahead - Despite a number of challenges, China's economy is manageable with no crisis on the horizon

Local governments can also enhance their ability to pay for infrastructure debts by introducing the mechanism of public-private partnerships and establishing financing and developing banks. [...]the possibility of an overall debt crisis is slight indeed. [...]as international hot money leaves China, it is possible for the central bank to ride the wave and cut the reserve requirement ratio to increase liquidity and reduce the opportunity for regulatory arbitrage.