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Christine Wong – Local Finance Under Siege: Unpacking the Paralysis of Fiscal Policy on the Eve of the 20th Party Congress
September 12, 2022 @ 8:30 pm – 10:00 pm
Speaker: Christine Wong, National University of Singapore
Local finances are under stress. In the first seven months of 2022 tax revenues were down 14%, and land revenues 32%, yet payroll and other expenditures have to be met, including the Covid-related bills for mass testing and other containment measures. Since 2021 social media has been flooded with posts reporting steep pay cuts for civil servants even in rich coastal regions. National aggregate data show social spending trending downward in GDP-shares. This seminar looks at the crisis in local finance that has accelerated through the pandemic, with local governments increasingly underfunded and tied down by contradictory policies. I will argue that local fiscal problems caused the government to under-deliver on its announced fiscal stimulus programs in both 2020 and 2021, a scenario on-track to be repeated in 2022 despite the massive injection of special project bonds.
Christine Wong is currently Visiting Research Professor at the East Asia Institute, National University of Singapore. She has previously taught at the Schwarzman College at Tsinghua University, the University of Melbourne, Oxford, University of Washington, University of California at Santa Cruz and Berkeley, and at Mount Holyoke College. She has also held senior positions at the World Bank and the Asian Development Bank. Christine has published widely on China’s public finance and rural development. Her recent publications include “Reforming public finance for the new era” (CPC Futures), “Why China’s 2022 fiscal stimulus will fall short” (EAI Commentary No. 53), “China’s 2022 budget and the fate of local government finance” (EAI Background Brief No. 1644), and “Plus ça Change: Three Decades of Fiscal Policy and Central–Local Relations in China” (China – an International Journal).
We would like to thank the MIT Sustainable Urbanization Lab, the School of Community and Regional Planning at the University of British Columbia, and the Harvard Fairbank Center for Chinese Studies. for supporting this event. Please subscribe to our mailing list if you’d like to receive e-mail notifications: http://mailman.mit.edu/mailman/listinfo/urbanchinaseminar.