The city of Wuhan in China's central region has published the names of more than 250 entities who owe it money in a local newspaper. This move highlights the pressure that the country's provincial governments are coming under due to fiscal problems. The list, published by the Yangtze River Daily, detailed 259 debtors who had failed to make outstanding payments dating back to December 2018, with debts totaling over CNY 300m ($42.4m). The most significant debtor on the list was a car manufacturer that owes the government CNY 23.5m. Despite an 8.5% YoY drop in Wuhan's Q1 revenue, the city's overall revenue hit over CNY 50bn for the same period. The Wuhan Municipal Bureau of Finance commented that while attempts had been made to contact debtors, these had been unsuccessful. The bureau urged those named on the list to "immediately perform the relevant statutory debt repayment obligations".
According to China University of Political Science and Law professor Shi Zhengwen, it is rare for provinces to utilise public notices to collect debt. Wuhan's actions highlight the issue of local government finances in the country, according to Shi. The public call for debt collection shows that the city is taking the recent push for financial discipline seriously. The Chinese government is grappling with a local government debt problem that may continue to impact the world's second-largest economy for years to come. According to Goldman Sachs, China's total government debt stands at around $23tn, including the buried borrowing of thousands of financing companies that provincial and city authorities set up. The majority of China's 31 provincial authorities have already surpassed the limit set by Beijing to indicate high debt risks, and while the regional governments are unlikely to default, larger debt levels may prompt significant reductions in public spending.