China’s local governments have long been the engines of its economic miracle, and their ailing finances have been a drag on growth in the past few years.

Under China’s decentralized system, local governments drive 85% of public spending and over 80% of infrastructure investment.  A decade-long fiscal erosion, the recent collapse in land revenues, and soaring debt have left them struggling to meet spending needs. These challenges stem from deep structural issues—a tax structure that lags behind economic changes, an overreliance on land sales to fund infrastructure and debt repayment, and a misalignment between spending responsibilities and fiscal capacity.  

Bold reforms will be needed to close the fiscal gap, revise how revenues are shared, and realign revenues with spending. They are all the more urgent given China’s rapidly ageing population and the looming expenditure needs in health and pensions that will require significant adjustments in the composition of public spending. 

Speaker: Christine Wong is Visiting Professor at the Schwarzman College at Tsinghua University.  She is also Honorary Professorial Fellow at the Asia Institute, University of Melbourne; and Non-Resident Senior Fellow at the East Asian Institute (EAI), National University Singapore.  She was Distinguished Visiting Fellow at the Australian Centre on China in the World, Australian National University in January – August 2026.

Christine has taught at top universities around the world. From March 2020 to January 2026, she was Visiting Research Professor at the EAI, National University of Singapore.  Before that, Christine was Founding Director of the Centre for Contemporary Chinese Studies and Professor of Chinese Studies at the University of Melbourne.  From 2007 to 2013, she was Professor of Chinese Public Finance and Director of Chinese Studies at the University of Oxford.  During 2000-2007 she held the Henry M. Jackson Professorship at the Henry M. Jackson School of International Studies, University of Washington.  She has also taught economics at the University of California, Santa Cruz and Berkeley campuses; and at Mount Holyoke College in Massachusetts.

In addition, Professor Wong has held senior staff positions in the World Bank and the Asian Development Bank, and worked with other international agencies including the IMF, OECD, and UNDP.

Professor Wong’s research has largely focused on China’s public finances. She has published widely on the impact of fiscal decentralization on macroeconomic management and policy implementation in education, health, social welfare, environmental protection, and urbanization in China.

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