The Great Asset Liquidation: A Bold Move to Tackle China’s Debt Crisis
The Chongqing district in China has launched a bold initiative to monetize government assets in an effort to address mounting debt pressure. Led by the executive deputy mayor, the task force aims to liquidate assets to cover the city’s debts, drawing parallels to the historical Great Leap Forward campaign.
While some view this extreme measure with skepticism, senior government adviser Li Yang argues that China’s valuable assets can effectively manage the debt crisis. Other regions like Zhuozi county and Quangang district have also taken similar steps to mitigate debt risks by selling off assets.
The central government’s directive on asset revitalization has prompted local governments to accelerate asset liquidation, resulting in significant revenue gains. Chongqing saw a 31.2% increase in non-tax revenue driven by asset disposals, highlighting the effectiveness of this strategy nationally.
As China continues to grapple with economic challenges, the asset liquidation trend showcases innovative solutions to manage debt and secure financial stability.