BEIJING (Reuters) – Revenue from land sales by Chinese local governments dropped 22.4% year-on-year in the first eleven months of the year, finance ministry data showed on Monday.
The decline was 22.9% in the period from January to October.
Such revenue, once a major contributor to local governments’ financial resources, has fallen sharply as developers downsize land purchases amid a years-long property market slump.
The decline in income from sales of land use rights strained local authorities’ coffers, hitting their ability to service debt, especially that borrowed off the books.
The central government has recently approved use of local governments’ special bond proceeds for buying idle land or increasing the reserve of land for sale.
In November, China also launched a 10 trillion yuan ($1.38 trillion) debt relief package for local authorities to enable them to direct more resources towards economic development.
($1=7.2466 Chinese yuan renminbi)
(Reporting by Yukun Zhang and Ryan Woo; Editing by Clarence Fernandez)
