China’s ‘looming risk’ as real estate crash escalates
China's looming real estate crash
As China’s property crisis escalates, attention is turning to a bizarre strategy which involves local governments selling off land – to themselves.
For years now, China has made headlines for its use of controversial funding tools known as local government financing vehicles, or LGFVs, which rose to prominence after the 2008 financial crisis.
In a nutshell, LGFVs are funding vehicles used by local governments, which typically involve investment firms selling bonds in order to finance real estate development or other local infrastructure projects.
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