The spotlight on China’s financial woes tends to focus on Beijing, but the nation’s financial challenges reach much further all the way down to local branches of government, under the Chinese Communist regime.
Local-level debt is now estimated at $13 trillion equivalent to one-third of China’s GDP in 2022 or $9,000 per Chinese citizen.
Beijing is addressing the local government debt crisis in China as economic concerns grow.
China’s State Council sent officials to over 10 of the country’s most financially weak provinces with the goal of reducing debt, but the post-pandemic climate has presented a challenge.
The impacts of Beijing’s strict lockdown orders are still wreaking havoc on demand while trade tensions have led to U.S. restrictions on high-tech exports to China.
That uncertainty is driving foreign companies to seek greener pastures and relocate to other countries.