China cracks down on ‘characteristic towns’ that misused land, real estate while racking up massive debt
- An initiative to develop towns outside megacities was launched five years ago as part of China’s urbanisation push, but improper planning has plagued projects
- Latest move comes as Beijing is striving to reduce high local government debt and excess that collectively pose a serious threat to China’s economy
Across China, poorly planned ghost towns filled with unsold homes or faux-historic architecture – part of an initiative meant to boost tourism and local revenue – are facing elimination as Beijing puts them under the microscope.
The move is in line with the central government’s efforts to crack down on high local government debt and excess.
Last month, the National Development and Reform Commission – the state planner – announced that these “characteristic towns” will be assessed and could be closed down if they fail to meet a set of criteria, including proper usage of land, preservation of the ecological environment, associated debt, necessity and safety.
“Excluding the existing traditional housing, residential land cannot take up more than 30 per cent of a characteristic town, and is encouraged to be less than 25 per cent,” the announcement said.
— Iris Ouyang (@IrisOuyang_SCMP) November 5, 2021
China's economy — the world's 2nd-largest — is on the brink of disaster.
President Xi Jinping must strike a balance between eliminating China's crushing debt and maintaining consumer confidence.
— Insider Asia (@InsiderAsia) October 24, 2021
— Nitkarsh Chourasia (@NitkarshC) October 21, 2021
China's major real estate players have been defaulting on their debt payments amid the Evergrande crisis.
Three more Chinese companies have now reportedly run out of cash.t.co/KMjDiNCYrM
— WION (@WIONews) October 19, 2021
h/t Digital mix guy