2020-01-03

The Song Remains the Same in China

Caixin: Major City Land Sales Break Record as Local Governments Fill Budget Gaps
Land sales in major Chinese cities hit a record high in 2019 as officials struggled to fill budget gaps left by tax and fee cuts that have bitten into their fiscal revenue.

Land sales revenue in 50 cities last year grew to a record 4.2 trillion yuan ($601.6 billion) as of Dec. 26, marking a jump of 17.6% from the same period in 2018, according to data provided by a research center of Hong Kong-based Centaline Property Agency Ltd.

“It is the first time that the land sales revenue of the 50 cities surpassed 4 trillion yuan,” said Zhang Dawei, chief analyst at the Centaline research center.
Land sales fund infrastructure investment which makes land valuable. The economy is dependent on this relationship for GDP growth. China has wanted to escape this "trap" for more than 5 years and finds itself more dependent than ever.

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