The Chinese Communist Party (CCP) is trying to reverse the devastating economic effects of its extreme three-year zero-COVID lockdown. After the Chinese new year, local provincial governments across the country began a new trend of huge infrastructure spending in an attempt to reverse the economic downturn.
An important source of funding for construction and infrastructure projects in China is special bonds issued by local governments. In 2022, the Chinese regime accelerated the issuance of special bonds and tilted its investment focus toward infrastructure. The Bank of China Research Institute published a report on April 22, 2022, stating that since the second half of 2021, China’s real estate market has been hitting rock bottom, and the pressure on local governments to repay special bonds has increased.
