Bills Now Due on China's Ghost Cities

Posted by Ed 5 yrs ago

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AsiaXPAT (Hong Kong) - Following years of malinvestment, China is about to face the music.

It's no secret that China has been supporting GDP numbers by building ghost cities that remain mostly empty and falling to pieces after years sitting vacant.

https://www.youtube.com/watch?v=Ie6zd3Rwu4c

https://youtu.be/XopSDJq6w8E

And now the debts incurred on these ghost cities and other boondoggles, in excess of $6 trillion, is coming due, and mass defaults are in the offing.

For decades, local governments in China borrowed heavily to build urban infrastructure and housing, fuelling the country’s spectacular economic growth. Now, they are struggling to to service these debts, adding another financial worry to Chinese policy makers’ list. Wall St Journal

Financial analysts are suggesting that China is headed in the direction of Japan with a major correction or worse ahead. In addition to this colossal malinvestment, China also has a rapidly aging population, in part due to years of a one-child policy.

As the key financial centre for China, there are serious implications for Hong Kong (and the world)

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Posted by Ed 5 yrs ago

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