On March 12, 2013, China Youth Daily published an article on the serious local government debt problems in China. Currently, China’s local governments owe 18 trillion yuan in debt. In order to pursue a higher GDP, local governments blindly borrow money without considering at all how to pay it back. Some officials said that borrowing money has become local governments’ economic opium. They wish they could stop but they cannot help borrowing more and more. According to the article, in order to help local authorities get rid of this “addiction,” it may be necessary to integrate local government’s credit rating system into cadre’s evaluation system.
Source: China Youth Daily, March 12, 2014