Statistics from China’s Ministry of Finance show that from January through February of this year, the public budget revenue of local governments was RMB 2.38 trillion, an annual growth rate of only 2 percent; national tax revenue decreased compared to the same period last year. Revenue from the sale of state-owned land use rights was 562.7 billion yuan, down 29 percent from the same period last year.
A professor at Shanghai University of Finance and Economics said that local governments have been in financial trouble for a long time and that the three-year epidemic has deepened the crisis. The economic slowdown has reduced local government revenues and property market adjustments have caused a sharp decline in local government finances. Some local governments are in financial distress.
This year’s central government work report mentioned that, “Some grassroots governments have large deficits.” The budget report emphasized the requirements of living a tight life and keeping a firm grip on budget management, asset allocation, and government procurement.
Source: Central News Agency (Taiwan), March 21, 2023
https://www.cna.com.tw/news/acn/202303210283.aspx