China Starts the Year in Deficit as Land Sales Continue to Slump

(Bloomberg) — China started the year already in deficit for the first time since 2020, with weak land sales due to the real estate slump slashing government revenue.

The broad deficit in the budgets for all levels of government was 78.4 billion yuan ($11.4 billion) in the first two months of this year, according to Bloomberg calculations based on data released Friday by the Ministry of Finance. That compares with a surplus of 309 billion yuan at the same point a year ago and shows the balance sheet weakness and already high debt levels that may limit stimulus to spur growth.