Instead of selling land to cash-strapped developers, local governments may be forced to rely more on purchases by local government financing vehicles – effectively selling to themselves. These LGFVs are companies set up by governments that raise money and pay for various projects, but their finances aren’t included on official balance sheets. Quite a few regions did this last year, the analysts wrote.
To help local governments beef up their spending power, Beijing has allowed them to sell some infrastructure bonds early, just as it did in other years when top policy makers were keen to get the provinces to borrow and spend as quickly as possible. China plans to keep its 2022 quota for local government special bond sales unchanged from last year at ¥3.65 trillion (A$786 billion), Bloomberg reported Tuesday.
The Ministry of Finance said governments at all levels made a combined ¥6.8 trillion yuan from selling land-use rights in the first 11 months of 2021, up 3.8 per cent from a year earlier. Income from sales is usually the highest in December, with the new data to be released later this month.
Bloomberg
Chinese local land sales drop off amid Beijing's call for spending - The Australian Financial Review
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