China’s land sales revenue down for 19th straight month in July
2023.08.21 05:29
© Reuters
BEIJING (Reuters) – China’s government land sales revenue declined for the 19th consecutive month in July, data from the finance ministry showed on Monday, adding to pressure on some debt-laden municipalities.
Land sales fell 10.1% from a year earlier in July, after declining 24.3% the previous month, according to Reuters calculations based on the ministry’s data.
For January-July, sales were down 19.1% year on year to 2.2875 trillion yuan ($313.1 billion).
The finances of many local governments have deteriorated amid a severe slump in the once-mighty property sector, which has caused a growing number of developers to default on their debt.
“The Chinese property sector’s transition to a lower contribution to the economy will result in structurally lower land sales, eroding Chinese RLGs (regional and local governments) fiscal revenue,” Jennifer Wong, a Moody’s (NYSE:) Vice President and Senior Credit Officer, said in August.
“At the same time, some RLGs are already facing larger debt burdens. Moreover, some LGFVs (local government financing vehicles) have higher refinancing burdens, raising their default risk particularly in weaker regions with deteriorating resources,” said Wong.
($1 = 7.3068 )
