Deleveraging a tricky task

Government must act prudently as any wrong move in this process could cause risks to converge in its financial system

China's economy is now changing gear from its previously fast-paced growth to a moderately lower speed, during which the government has to continue to push forward economic structural adjustments and address the side effects of the large-scale economic stimulus package it adopted in the wake of the global financial crisis in 2008.

However, the country not only faces the pressures of a decelerating economy, the government also has to be on the alert around the clock ready to address the looming risks emanating from colossal local government debts, shadow banking, industrial overcapacity, as well as the possible busting of its real estate bubble.