China’s finance ministry vows to increase central bond issuance and flexible transfer payments to cash-strapped local governments in 2026, easing austerity measures triggered by collapsing land sales revenue. While support will help, Beijing signals modest aid won’t fully reverse trillions in arrears and spending cuts.
China’s central authorities plan to bolster financial support for provincial and municipal governments throughout 2026, addressing chronic revenue shortfalls that have hampered local spending. The finance ministry made these commitments at the National Fiscal Work Conference, which wrapped up on 28 December, aiming to ease pressures through smarter debt management and flexible funding allocations.