Commentary: How to Break China’s Excessive Dependence on Land Revenues

Land finance, or selling land for urban development, has become a major source of fiscal revenue for Chinese local governments. However, the persistent property slump in recent years has led to a knock-on effect on the land market, hurting local governments’ land sales revenues and exacerbating the strain on their budgets.

Last year, land sales revenues fell 13.2% nationwide to around 5.8 trillion yuan ($823 billion), marking the second straight year of decline.