China’s ailing economy is becoming increasingly apparent, with local governments facing financial constraints and the Communist authorities frequently mentioning the need to “tighten their belts”. Recently, the city of Suzhou in Jiangsu Province issued a document outlining ten measures to deepen the implementation of the requirement for government agencies to live frugally. Mainland residents have expressed that when the officials call for “tightening their belts”, it’s the ordinary people who end up bearing the brunt.
In terms of assets, the document calls for promoting centralized management and coordinated use of low-efficiency operating assets, as well as adopting methods such as exchange, rental, and auctioning to revitalize idle land and properties. By the end of this year, all levels of government agency management departments are required to establish a comprehensive system for asset maintenance, renovation, and disposal. The sharing and joint use of asset resources should be accelerated, with meeting rooms and public service facilities between Party and government agencies at all levels to be fully shared and utilized by the end of the year. Party and government agencies that meet the conditions should actively open up parking spaces, outdoor restrooms, and activity areas to the public, maximizing their usage.
Regarding official vehicles, the measure proposes strict management of scrapping and updating official vehicles, with a principle that vehicles with a usage period of less than 10 years or a mileage of less than 100,000 kilometers should not be updated. The proportion of new energy vehicles in the replacement of vehicles should ideally reach 100%. Official trips along high-speed rail routes should generally not arrange for official vehicles or car rentals, and next year, there will be comprehensive reform of operating and maintenance fees.
Furthermore, the document specifies the active adoption of contract energy management for energy-saving renovations, advocating for the advancement of photovoltaic projects. By the end of next year, county-level and above administrative centers implementing contract energy management should account for over 60%, and units exceeding the predetermined energy consumption limits should all be reduced to a reasonable level. Regular assessments and reports on the effectiveness of combating food waste in canteens of Party and government agencies are to be conducted. Items falling under the category of cross-departmental general procurement for the year must be purchased within the municipal centralized procurement system to further economize financial funds.
In the past, many local governments in China have put forward similar requirements. Earlier, the Zhejiang Provincial Public Security Department issued 26 measures to encourage thrift and adherence to the tight living conditions in government agencies, including dining at the department canteen, gradually reducing office consumables by 10% annually, and strictly adhering to air conditioning conditions and temperature standards.
On June 20th of this year, the General Office of the Central Military Commission of the Communist Party of China issued a document on “building a frugal army”, emphasizing the need to tighten living conditions, exercise thrift, and improve the efficiency of military operations and the use of defense resources.
Commentator Zhong Yuan remarked that slogans like “building a frugal army” or for the military to “tighten their belts” have been mentioned by the Communist Party several times in recent years. Nevertheless, the current emphasis on living frugally under these circumstances indicates that even the military is running out of funds.
The severe zero-Covid policy implemented by the Communist authorities from 2020 to 2022 depleted local finances, resulting in salary cuts for civil servants since the second half of 2021, affecting nearly all provinces in China with allowances and bonuses being reduced or discontinued. Even after the end of the zero-Covid policy in late 2022, China’s economy has continued to decline, facing challenges in recovery.
In 2022, the Communist authorities reported on the expenditure of public funds at the central and local levels, with frequent mentions of the need to “tighten their belts”, urging all institutions to refrain from spending lavishly. They also highlighted instances where various regions resorted to borrowing and hoarding land.
According to data from the Ministry of Finance of the Communist Party of China, land transfer income (i.e., land transfer revenue) in local government funds decreased by 28.5% in the first eight months of 2022 compared to the same period the previous year.
As the Communist Party faces financial constraints, state-owned enterprises and central enterprises are also struggling under heavy burdens. In May, China Railway Fifth Bureau called on all its staff to tighten their belts through an official public post.
On July 9th, Tianjin independent media figure “Sān Jīn Zuìjiǔ” expressed that when government revenue falls short and government agencies are required to live frugally, it is the ordinary people who suffer the most.
Recently, Zhejiang independent media figure “Lèguān de Píndàn Rénshēng” stated that when the government is broke, the ordinary people have even less money.
He pointed out that the majority of grassroots Chinese people are living in extreme poverty, many are in debt and struggling to make ends meet every month. He suggested cutting unnecessary expenses and saving money to prepare for unforeseen circumstances.
Many netizens agreed with these sentiments:
“活潑蘋果QC”: Most people can’t earn enough money, salaries are low, some are even unemployed, and this is the main issue.
“靈敏豆花0Tx”: It’s difficult for rural folks to access medical care! Hospitals have become banking institutes! This is worth pondering on!
By addressing the financial challenges through implementing measures to tighten their belts, the Chinese government aims to navigate through the economic difficulties ahead, impacting both government agencies and ordinary citizens alike.