CHAPTER 3

Factory Construction

Local officials are responsible for processing business licenses, company articles of incorporation, and subsidies. This gives them tremendous influence over how foreign-invested enterprises (FIEs) are organized, what they make, how much they make, and even where they make it. For example, in February 2020, during the coronavirus outbreak, government officials nationalized an FIE producing surgical masks and put export restrictions in place.1

With regard to controlling where things are made, it’s common for local officials to steer manufacturing operations into development zones. In 2011, there were 1,600 development zones in China.2 By 2019 that number had climbed to 2,543. Today, China is home to more than half the world’s development zones.3

With so many zones to choose from, which is best? It depends. There are 10 different types of economic development zones in China, the most popular of which are the following:

• special economic zones (SEZs)

• free trade zones (FTZs)

• economic and technological development zones (ETDZs)

• high-tech industrial development zones (HIDZs)

SEZs were the first. Four opened up along the southeastern coast in the early 1980s. Today, SEZs are located in 19 Chinese cities. As Figure 3.1 shows, all of these are located along the coast.

Figure 3.1 China’s special economic zones

Source: Adapted by calling out SEZs on “Map of China en names.svg,” by P. Potrowl, 2010, https://commons.wikimedia.org/wiki/File:Map_of_China_en_names.svg.

Besides benefiting from modern infrastructure and proximity to seaports, operations inside SEZs also enjoy lower income taxes. For example, as of 2019, Chinese companies pay upward of 13 percent business-to-business value-added tax (VAT) and 25 percent corporate income tax. Companies in SEZs might pay4:

• 0 percent local tax

• 0 percent duty

• 0 percent income tax until profits are earned

• 0 percent income tax for the next 2 through 3 years

• Half the normal income tax for 2 additional years

• Standard rates thereafter

SEZs have proven so popular that they accounted for 22 percent of China’s GDP, 45 percent of foreign direct investment, and 60 percent of exports in 2015.5

Building on this success, the state council introduced FTZs in 2013. Companies inside any one of China’s 11 FTZs, as shown in Figure 3.2, enjoy bonded warehouses; 10 percent income tax; and relaxed rules on imports, exports, and foreign currency exchange.6 The Shanghai Free Trade Zone has proven so popular that 3,633 enterprises registered within 3 months of its launch.7

Figure 3.2 China’s free trade zones

Source: Reprinted from “China Pilot Free Trade Zones,” by HKTDC Research, 2019, http://china-trade-research.hktdc.com/business-news/article/Facts-and-Figures/China-Pilot-Free-Trade-Zones/ff/en/1/1X000000/1X0A2V2D.htm.

With so many FTZs to choose from, which is best? It depends. With land and labor making up close to 70 percent of operating costs in China, FTZs in the western provinces of Chongqing, Shaanxi, and Sichuan are particularly well suited for large, vertically integrated operations.8 On the other hand, labor-intensive operations with extensive, domestic, supply chains might prefer FTZs in the central provinces, where land and labor are cheaper than along the coast and logistics channels are more developed than in the west. Advanced manufacturing operations dependent on international supply chains tend to cluster along the coast, where the pool of high-skilled labor is larger, infrastructure is more up to date, and transportation costs are lower.

The cost of setting up operations in an SEZ may be out of reach for small manufacturers focused on light to medium industry. For these operations, the state council has established ETDZs. Unlike SEZs, which are based around large tier 1 cities, ETDZs are located in smaller tier 2 cities (and the suburbs of tier 1 cities). Although the infrastructure is less developed, costs are substantially lower. Table 3.1 lists China’s 54 state-administrated ETDZs in 2016.9

Table 3.1 State-administered ETDZs

Beijing	Guangzhou	Kunshan	Qingdao	Weihai	Yinchuan
Changchun	Guiyang	Lanzhou	Qinhuangdao	Wenzhou	Yingkou
Changsha	Hainan	Lhasa	Shanghai	Wuhan	Zhanjiang
Chengdu	Hangzhou	Lianyungang	Shenyang	Wuhu	Zhengzhou
Chongqing	Harbin	Nanchang	Shihezi	Xian
Dalian	Hefei	Nanjing	Suzhou	Xiamen
Dongshan	Hohhot	Nanning	Taiyuan	Xiaoshan
Fuqing	Huizhou	Nantong	Tianjin	Xining
Fuzhou	Kunming	Ningbo	Urumqi	Yantai

By 2020, the number of ETDZs grew fourfold.10 As the high rate of growth indicates, the majority of manufacturing in China is done by small- to medium-sized factories operating in local development zones.

What about operations involved in research and development (R&D)? Since 2012, China has been the worldwide leader in patents and trademarks.11 As impressive as this sounds, it’s important to remember that filing patents is one thing, but bringing them to market is something else. In 2016, an intellectual property management company examined 1,000 Chinese patents and found that less than 5 percent of them had any commercial potential. The same study found 50 percent of U.S. patents were commercially viable.12

To better commercialize R&D, the state council and the Ministry of Science and Technology have set up over 100 national-level HIDZs.13 Companies inside HIDZs enjoy the following benefits: 15 percent corporate income tax, VAT exemption on R&D exports, VAT refund on R&D equipment purchases, and duty exemption on R&D imports. Companies will also receive discounts on overseas purchases if items are listed in the Catalogue of Encouraged Imported Technology and Products. In light of these perks, the number of companies setting up operations in HIDZs increased 60 percent every year from 1992 through 2005.14 China now has its very own “Silicon Valley” in the city of Chengdu, where 83,000 companies recorded $20 billion in trade during 2017.15

For U.S.-based companies seeking to lower tax bills by setting up operations inside development zones, savings apply only if Chinese-generated income stays in China. Otherwise, U.S. corporate income tax is owed on repatriated profits. When the U.S. corporate income tax rate was cut from 35 percent to 20 percent in 2017, the Chinese Tax Bureau responded to the possible outflow of cash by exempting FIEs from withholdings tax if funds were reinvested in encouraged industries.

FIEs seeking tax exemptions and reduced income tax need to pay close attention to Chinese tax laws. Provisional income taxes must be filed monthly (or quarterly). Certified public accountants must sign off on accounts annually. Accounts can be particularly challenging for multinational companies (MNCs) involved in employing foreign support staff and/or subsidiaries. For example, foreigners working in China are required to participate in social security plans. Plans jointly funded by employers and employees include pensions, medical insurance, and unemployment insurance. Plans funded solely by employers include workplace injury insurance and maternity insurance. Because plans are administrated at the provincial or municipal level, it can be the case that certain locations do not require foreigners to participate. Some countries (e.g., Germany, South Korea, Denmark, Canada, Finland, Switzerland, the Netherlands, Spain, Luxembourg, Japan, and Serbia) have signed social security agreements with China. Citizens of these countries working in China are eligible for social security exemptions. Regardless of country of origin, anyone working in China for more than 183 days in a year owes Chinese income tax. The tax bill is calculated on total global income (not just the amount paid while working in China). When it comes to transfer pricing between associated businesses, Chinese tax authorities require substantial amounts of documentation proving “arms’ length” transfer pricing is being used. According to the Enterprise Income Tax Law of 2008, association is defined as companies sharing board members, 50 percent of debt, or 25 percent of ownership.16

Onerous tax regulations aren’t the only reason operations keep their Chinese income inside China. Banking regulations also limit what they can do with their money. For example, in 2016, State Administration of Foreign Exchange (SAFE) cut the maximum amount that firms in China could send overseas from $50 million to $5 million.17 Out-of-country payments were also limited to less than 30 percent of shareholders’ equity.18

In light of low taxes, tight currency controls, and extensive banking regulations, operations managers can quickly find that the only real use for local profits is reinvesting them in local operations. Incentivizing reinvestment is key to China’s development, particularly in the construction sector.

The top 60 Chinese builders control approximately 30 percent of the construction market. This gives builders a big advantage when negotiating construction terms. Another source of advantage is who they are. Of the top 10 contractors, seven are state-owned enterprises (SOEs). A high degree of state control also describes how factories are designed. Of the top 60 design firms, 50 are SOEs.

Given the state’s dominant role in factory construction and design, it’s little wonder that both sectors are heavily regulated. An argument could be made that regulations are needed to ensure factories are built according to safety standards, quality is maintained, and the environment is protected. The counterargument is that excessive regulation drives up construction costs, increases delays, reduces quality, and promotes corruption. In 2015, U.S.–China Business Council outlined the long and complex system of approvals and permits needed to initiate a wholly owned foreign enterprise (WOFE) construction project (Figure 3.3).19

Figure 3.3 Timeline for a WOFE construction project

Source: Reprinted from “Licensing Challenges and Best Practices in China,” by The US–China Business Council, 2014, www.uschina.org/sites/default/files/Licensing%20Challenges%20and%20Best%20Practices%20in%20China-Jan%202014.pdf.

The construction approvals process typically starts with the management committee responsible for the development zone where construction will occur. If the business prospectus and scope of work are consistent with the committee’s goals for the location, the application will likely be approved and make its way to the local economic development bureau (EDB).

EDB review starts with a feasibility report. This is a technical analysis of construction scope. Applicants can’t write reports themselves. They need to hire locally licensed writers. Given the level of detail required, factory designers must be hired before feasibility reports can be written.

Like report writers, factory designers must also be licensed. Licenses are issued either at the municipal or at the provincial level, depending on what’s being designed and where construction will occur. For example, piping layouts typically require municipal licenses. Licenses vary depending on what’s being piped (clean water, waste water, compressed air, volatile gases, steam, etc.).

It’s highly unlikely that one design firm will have all the necessary licenses to design everything in construction scope. As a result, designers subcontract tasks to other designers. With so many parties involved, delays, mistakes, and confusion are commonplace.

Further complicating factory design is determining the level of detail needed for feasibility reports. Drawings need to be specific enough to meet EDB requirements but not too detailed; otherwise, time and money are wasted if reports are rejected. To ensure feasibility reports have the right amount of detail, the local EDB might recommend writers and designers. Unfortunately, these firms are typically the most expensive.

If factory designs call out additional transformer capacity is needed, the approvals process becomes more complex. The local power bureau will need to determine whether the power request meets National Development and Reform Commission (NDRC) guidelines for energy efficiency. If approved, the factory will pay per kilowatt hour of electricity consumed plus a fixed, monthly amount per kilowatt of transformer capacity installed. Even when factories are operating within their approved power levels, they could experience power cuts. The issue is supply and demand.

Nearly 70 percent of China’s energy is consumed by six sectors:

1. Electricity generation

2. Steel manufacturing

3. Nonferrous metal processing

4. Construction materials

5. Oil processing

6. Chemicals

When their demand for power peaks, operations in other sectors may experience power rationing or cuts. The issue is coal. Over 70 percent of China’s electricity is generated by burning coal. Coal prices change with the market, whereas electricity prices don’t. They’re set by the NDRC. For example, in 2011, when coal prices rose 80 percent, the NDRC increased electricity prices only 15 percent, the intention being to control inflation. Unfortunately, low electricity prices and high coal costs meant that the more power generated, the more money power stations lost. In 2018, 40 percent of China’s coal-fired power stations lost money.20

When power cuts happen, factory managers can find their operations are affected for hours, days, or even weeks. To add to their frustration, a fixed portion of electric bills remains unchanged during cuts.

If factory management can’t tolerate power disruptions, installing backup, diesel generators is an option. However, this isn’t a quick or easy fix. Time from plan submission to final approval can take anywhere from 4 to 6 months. After factoring in maintenance, operating, and diesel costs, factory generated power can be anywhere from three to four times more expensive than city power.

When discussing power issues with local officials, it’s important to remember that many decisions are outside their control. For example, the National Energy Commission (NEC) writes national energy policy. A national policy of particular importance to local power bureaus is lowering energy consumption per unit of production.21

Assuming the local EBD and power bureau approve a feasibility report, the next step is submitting a job safety assessment report to the workers safety bureau (WSB). The report details what, if any, dangerous activities will be performed during factory construction and how these risks will be managed. As with feasibility reports, applicants can’t write their own safety assessment reports. They must be prepared by locally licensed writers.

In addition to a job safety assessment report, applicants will also need to file an environmental impact assessment (EIA) report with the local EPB. Although EIA report content isn’t standardized, China’s Environmental Protection (EP) Law recommends that reports answer the following questions:

• What are environmental conditions at the site prior to the start of construction?

• What type of business will be done once construction is complete?

• How many people will be employed?

• What will be made?

• How much will be made?

• What equipment, materials, and processes will be used?

• How much waste will be generated?

• How will waste be treated?

• Can treatment methods meet environmental standards?

Similarly to the case with all other construction reports, applicants can’t write their own EIAs. They must be prepared by writers licensed by the local EPB, which decides on EIA scope and approves reports. For example, if construction involves expanding a factory, the local EPB determines whether an addendum to an existing EIA will suffice or a new EIA is needed. An addendum is generally preferred because it restricts EIA evaluation to the area of new construction. If a new EIA is needed, the entire facility must be reevaluated. Because China’s environmental laws (and local EPB interpretations of these laws) frequently change, reevaluations typically require substantial facility updates.

Once the feasibility report, EIA report, energy use report, and workers safety reports are all filed and approved, applications can proceed to land bureau registration.

The local land bureau will need to issue a land use right certificate. This certificate gives users the right to perform specific tasks on the land for a defined period. Factory land use rights are typically for 30 years. During this time factory owners can sell rights, but land use as described in certificates can be changed only at the ministerial level.

In addition to securing land use rights, applicants will also need a geological report. This report provides details about the water table, ecology, soil weight-bearing capacity, and possible pollutants at the construction site. As with all the other reports, only locally licensed writers can prepare geological reports.

With an approved geological report in hand, construction plans can be filed with the local tax, finance, and statistics bureaus, which ensure taxes are being paid, land use is accounted for, and total investment is recorded. Business registration bureau approval may also be needed if, as a result of construction business, activities change. If new business activities involve foreign trade, the import and export bureau must approve the request.

Once all government reports and bureau notifications are filed, registered, and approved, detailed design work on the factory can finally begin. Design work is relatively simple if the factory, as shown in Figure 3.4, resembles what’s typically built in the area.

Figure 3.4 Typical Chinese factory

Source: Courtesy of Peng Zhiqiang.

Officials from at least a dozen government bureaus will need to review factory designs. These bureaus include the following:

1. Fire bureau

2. Health bureau

3. Labor bureau

4. Planning bureau

5. Construction bureau

6. Construction quality inspection bureau

7. Construction safety bureau

8. Power bureau

9. Water bureau

10. gas bureau

11. telephone bureau

12. traffic bureau

Local officials are able to quickly approve only factory designs that they’re accustomed to seeing. Anything unique or incorporating imported equipment will typically take much longer to approve. Depending on how many drawing revisions are required, approvals can take anywhere from 2 to 6 months. Only after approvals are given is it possible to bid contractors.22

It’s common practice to use locally licensed auditors when selecting contractors. Auditors know local construction costs. This allows them to weed out contractors who are over- or underbidding. Auditors aren’t finished once contractors are selected. During the build, they check whether brands and quantities used match designs. They also send building material samples out for quality testing.

In addition to hiring auditors, companies might hire a supervision firm. Supervisors oversee contractors to ensure that the following conditions are met:

• The right people are in the right places doing the right jobs at the right times.

• Milestone completion dates specified in the purchase agreement are met.

• National, provincial, and local safety standards are followed.

Auditors and supervisors are typically paid a flat fee for their work. Bonuses might be paid for uncovering quality issues or meeting build schedules. Auditors are also paid to produce an audit book. The supervision company presents this book to government officials as evidence that construction quantities, materials, and methods matched what was approved.

The supervision company will also follow up with the provincial survey commission. The commission is responsible for performing a survey of the build site for the land bureau. The land bureau is ultimately responsible for approving factory occupancy.23

Clearly, construction in China has many issues. For starters, the same agencies that license report writers, designers, auditors, and supervisors also approve their work. It is therefore possible that the case approvals are based more on connections than on the quality of work done.

Another issue is bureaucracy. In 2018, the General Office of the State Council issued a pilot reform of engineering construction projects approval. The goal was to simplify the approvals process by combining multiple governmental approvals into a more unified system.24 As of 2020, reforms haven’t been rolled out.

To add to the complexity of construction, owners don’t actually own the land on which their factories sit. Land in China hasn’t been privately owned since the Party came to power in 1949. Rural land is owned by village collectives.25 Urban land is owned by the state. Factories can be built only on urban land leased from local governments.

Local governments need factory investment because their budgets are highly dependent on land lease revenues. For example, unlike VAT, in which 75 percent of receipts are sent back to the central government, local governments keep 100 percent of land lease payments. Leasing land generates a substantial amount of money considering real estate and construction make up roughly 30 percent of China’s economic output. However, lease payments aren’t the only revenue stream from land development. Local governments can also earn a lot of money from investing in development projects.

Prior to 2014, it was illegal for local governments to borrow money. Part of the reason was to prevent officials from speculating on land development. Local governments could, however, form urban development and construction companies. These SOEs have borrowed heavily to invest in construction projects. In 2010, China’s National Audit Office estimated local governments had accumulated close to $2 trillion in debt. Nearly 80 percent of this debt was in land development projects.26 Local governments are using land lease payments to service almost 40 percent of their debt. Debt is structured such that in 2020 Chinese developers had close to $65 billion in aggregate bond payments due27. The problem with such a high dependence on land leases is availability of land to lease.

China has over 1.3 billion people to feed in a country where only 15 percent of the land is suitable for agriculture. Unfortunately, most of the fertile land is along the coast, where thousands of economic development zones are located. To protect the food supply, provincial and ministerial land bureaus set strict quotas for local governments specifying the following:

• Maximum amounts of rural land that can be converted into urban land

• Minimum amounts of rural land that must be maintained

• Maximum amounts of urban land that can be under development

Company executives hoping to build factories need to be very wary of local officials promising to do so on rural land. Land reclassification can happen only at the ministerial level.

As available lots become scarcer, owners of existing residences or factories can find themselves being relocated to make room for new development.

What options do owners have once officials have earmarked their properties like the one shown in Figure 3.5 for demolition? Not many once the symbol to tear down (as shown in Figure 3.6) is painted on the building.

Figure 3.5 Factory to be torn down

Source: Courtesy of Xubiao Wu.

Figure 3.6 Chinese character designating a building for demolition

Source: Courtesy of Xubiao Wu.

Local officials might offer factory owners cash to leave. The amount, however, may not be enough to move equipment and build a new factory. In lieu of cash, officials might offer to build a new factory. Unfortunately, government-built factories are generally made to a lower quality standard in areas unable to attract investment.

Whenever and wherever factories are built, delays are common. A big part of the problem is the approximately 12 government agencies and five government reports required. The wheels of bureaucracy turn very slowly. In the past, to make up for lost time, environment protections all too often fell by the wayside.

By 2002 China was home to six of the world’s 10 most polluted cities. That same year, 75 percent of the water in rivers flowing through Chinese cities was unsuitable for drinking or fishing.28 How was pollution on such a level possible? After all, municipal planning departments can’t approve construction drawings for bidding until local EPB officials have signed off on EIA reports.

In reality, the local EPB is funded by the local EDB. Construction projects favored by the EDB might receive preferential treatment by the EPB. By the same token, if EDB officials don’t want particular investments to happen, EIAs might never be approved regardless of environmental impact. It could be argued that prior to 2015 the EPB was free to protect the environment so long as its efforts didn’t get in the way of development. Fines were capped, and EPB officials didn’t have the right to seize polluting assets. For example, it might cost 500,000 RMB per year to operate in compliance with environmental standards. But the fee for ignoring regulations might be only 10,000 RMB.

Clearly, the policy of prioritizing development over the environment wasn’t sustainable. The National People’s Congress approved revisions to China’s EP Law in 2015. Polluting factories for the first time face:

• Cumulative fines with no limits

• Permanent closure or temporary suspension of operations

• Criminal charges that can result in detention of managers

New factory construction is increasingly judged against national “green” deliverables. In the 11th Five Year Plan (2006 through 2010), the NDRC called for reducing water consumption per unit of industrial value add by 30 percent, reducing energy intensity by 20 percent, and increasing recycling on industrial solid waste by 60 percent.29 At the same time, China’s Ministry of Construction launched a green building evaluation standard. The standard rates new construction across six categories:

1. land savings and outdoor environment

2. energy savings

3. water savings

4. materials savings

5. indoor environmental quality

6. operations and management

As a result of these efforts as well as (1) forbidding the burning of coal inside city limits, (2) closing thousands of polluting factories, and (3) restricting heavy truck traffic in urban areas, China’s average annual concentration of airborne pollutants (termed PM2.5) decreased almost 60 percent from the level in 2010.30 By 2018 none of the world’s 10 most polluted cities were in China.31 The goal, by 2030, is to reduce Chinese carbon dioxide emissions by at least 65 percent compared with 2005 levels. By 2060, the Party aims to install sufficient green power generation to be carbon neutral.32

It could be said that through new laws and regulations, China will be able to significantly reduce the environmental impact of development. The counterargument is that when faced with new laws, companies will simply be less open about disclosing environmental impact. For example, a recent report indicated that 98 percent of the 142 Chinese companies analyzed failed to meet even half of the minimum climate risk disclosure standards.33 Another way to hide impact is to make improvements in one location at the expense of others. As of 2018, six of the 10 most polluted cities in China are in Hebei province. Hebei is the country’s largest steel producing region.34 Pollution control measures have failed to address how steel is made. The same approach could be said to describe how buildings are made.

About 2 billion square meters of new buildings were under construction in China during 2012. Yet only 10 buildings applied for recognition under China’s national three-star green building rating system.35 By 2020, China’s national climate commitment was calling for 50 percent of all new buildings constructed to be certified green.36 The problem with implementing such sweeping reforms is that so many Chinese structures, such as the one shown in Figure 3.7, aren’t built so much as poured.

Figure 3.7 Typical all-cement building construction

Source: Courtesy of Xubiao Wu.

Every three and a half years China pours more cement than the United States did during the entire twentieth century. To make all this cement, close to two billion tons of limestone is crushed, milled, and ground annually, putting a tremendous amount of dust and carbon dioxide into the air. In 2018, China’s building sector accounted for approximately 20 percent of the country’s total energy consumption and 25 percent of greenhouse gas emissions.37 Sustainability requires that building regulators, designers, report writers, contractors, auditors, supervisors, and operations managers rethink factory construction in China. One way local governments are promoting new construction methods is through financial incentives. For example, in Wuxi, buildings that achieve a three-star green building rating are eligible for a $75,000 stipend from the district government.

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3 D. Dodwell. 2019. “China is the World Leader in Special Economic Zones but the Results are Erratic at Best, With Many Being Underused or Failing to Benefit the Wider Economy,” South China Morning Post. www.scmp.com/comment/opinion/article/3023067/china-world-leader-special-economic-zones-results-are-erratic-best, (accessed September 17, 2019).

4 China Unique. 2019. “Special Economic Zones in China,” http://chinaunique.com/business/sez.htm, (accessed March 23, 2019).

5 China Development Bank. 2015. “China’s Special Economic Development Zones,” www.worldbank.org/content/dam/Worldbank/Event/Africa/Investing%20in%20Africa%20Forum/2015/investing-in-africa-forum-chinas-special-economic-zone.pdf, (accessed May 12, 2017).

6 HKTDC Research. 2019. “China Pilot Free Trade Zones,” http://china-trade-research.hktdc.com/business-news/article/Facts-and-Figures/China-Pilot-Free-Trade-Zones/ff/en/1/1X000000/1X0A2V2D.htm, (accessed November 12, 2019).

7 M. Zito. 2014. “Logistics, Warehousing and Transportation in China (Part 2),” China Briefing. www.china-briefing.com/news/logistics-warehousing-transportation-china-part-2/, (accessed November 17, 2018).

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12 S. Koch. 2016. “China’s Dysfunctional Patent Flood,” Biocentury. www.biocentury.com/bc-innovations/strategy/2016-11-21/how-poor-patents-hinder-tech-transfer-china, (accessed September 1, 2018).

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20 S. Ambrogi. 2018. “40% of China’s Coal Power Stations Are Losing Money,” Carbon Tracker. www.carbontracker.org/40-of-chinas-coal-power-stations-are-losing-money/, (accessed August 20, 2019).

21 The goal is 16 percent reduction in power per unit of GDP using 2012 as a baseline.

22 Contractors can build using only drawings that carry seals from licensed designers and government approvers.

23 While awaiting land bureau approval, factories can be used for a 6-month probationary period.

24 E. Yan and B. Lui. 2019. “Construction and Projects in China: An Overview,” Thomson Reuters: Practical Law. https://content.next.westlaw.com/2-521-5363?transitionType=Default&contextData=(sc.Default)&__lrTS=20191129202942907, (accessed February 10, 2020).

25 While collectives own land, they can’t sell it. Nor can they use it for purposes other than farming.

26 D. Davis and D. McMahon. 2013. “Xi faces Test over China’s Local Debt,” The Wall Street Journal. www.wsj.com/articles/china-local-government-debt-surges-to-3-trillion-1388395467, (accessed July 16, 2018).

27 P. Liu. 2020. “Evergrande Slashes Property Prices by 30 per cent across China for One Month, Sounding Clarion Call on Discount War,” The South China Morning Post. https://www.scmp.com/business/china-business/article/3100510/evergrande-sounds-clarion-property-price-war-chinas-biggest, (accessed Sept. 9, 2020).

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