On July 21, 2013, China Review News published an article titled “China’s Local Governments Owe Over US$12 Trillion in Debt; a Dangerous Sword Hangs over the Head of the Economy.” Since 2010, local governments’ debts have become the sword of Damocles hanging over China’s economy. According to China’s National Audit Office statistics, the amount of the debt that local governments owe exceeds US$12 trillion. However, The International Monetary Fund (IMF) believes that China’s total public debt exceeds 50 percent of its GDP.

According to the article, China needs large scale financial reform as well as fiscal reform over the next 10 to 30 years.

Source: China Review News, July 21, 2013
http://www.zhgpl.com/doc/1026/4/0/5/102640566.html?coluid=45&kindid=0&docid=102640566&mdate=0721100348

On July 21, 2013, China Review News published an article explaining why it is important to safeguard the 1.8 billion mu of arable land in China. As the urbanization in China is spreading fast, some urbanization supporters propose to break the red line of the 1.8 billion mu of arable land so as to further expand urban construction. The article explained that the 1.8 billion mu of arable land is the minimum bottom line to ensure food security in China.

Source: China Review News, July 21, 2013
http://www.zhgpl.com/doc/1026/4/0/4/102640403.html?coluid=53&kindid=0&docid=02640403&mdate=0721073613

On July 19, China News Review published a report on the “2013 Development of People’s Livelihood in China.” The report claimed that close to 90 percent of Chinese families own their own housing space. The average size for housing is 100 square meters (1,076 square feet) per family or 30 square meters (323 square feet) per person. On July 20, Xinhua published a commentary calling the published results questionable and misleading because they used the average statistical method. The commentary stated that some families don’t own houses while some groups of people own multiple or even dozens of housing properties. It questioned whether the data was correct, why the housing leasing market would be so prosperous in the city, and why large numbers of families still live in “snail house” conditions. In the end, the commentary suggested that a different methodology should be applied in calculating the results so that it truly reflects reality.

Source: Xinhua July 20, 2013
http://news.xinhuanet.com/comments/2013-07/20/c_116613384.htm

Xinhua carried an article that Beijing Youth Daily had originally published. The article said that People’s Bank published financial statistics showing that, by the end of June, the total national savings in China had reached 1.009 quadrillion yuan (US$160 trillion). This was the first time it broke the 1 quadrillion mark. In the first half of 2013, total savings grew 9,090 trillion (US$1,480 trillion), up 1,710 trillion (US$278 trillion) compared to 2012. Specifically, personal saving grew 4,139 trillion (US$674 trillion) and savings for the non-financial entities grew 2,320 trillion (US$378 trillion). The article disclosed that growth in government and business entities has propelled the growth in national savings; whereas personal savings, as a percentage of the national savings, has been declining over the past ten years. The article stated, “It is an indication that the public funding allocated to education and health areas are far less than desired thereby pushing the general public to find ways to come up with "preventive savings" themselves.

As to the reason for the growth in personal savings, the article pointed out that, first, people are reluctant to spend money because many still receive a low income; second, the government provides insufficient funding for the education, medical, and housing areas, which forces residents to have their own “preventive savings.”

The article called the imbalance of the saving ratio a key issue to be addressed in income distribution reform.

Source: Xinhua, July 21, 2013
http://news.xinhuanet.com/fortune/2013-07/21/c_116622492.htm