Multilevel financing of sustainable infrastructure in China—Policy options for inclusive, resilient and green growth

Ehtisham Ahmad

Article ID: 1251
Vol 5, Issue 1, 2021, Article identifier:1251

VIEWS - 125 (Abstract) 59 (PDF)

Abstract


COVID-19 has amplified existing imbalances, institutional and financing constraints associated with a development strategy that did not take sufficient account of challenges with emissions, environmental damage and health risks associated with climate change in a number of countries, including China. The recovery from the pandemic can be combined with appropriately designed investments that take into account human, social, natural and physical capital, as well as distributional objectives, that can also address commitments under the Paris agreement. An important criterion for sustainable development is that the tax regimes at the national and sub-national levels should reflect the same criteria as the investment strategy. Own-source revenues, are essential to be able to access private financing, including local government bonds and PPPs in a sustainable manner. Governance criteria are also important including information on the buildup of liabilities at all levels of government, to ensure transparent governance.
Despite differences in political systems, the Chinese experiences are relevant in a wide range of emerging market countries as the measures utilize institutions and policies reflecting international best practices, including modern tax administrations for the VAT, and income taxes, and benefit-linked property taxes, as well as utilization of balance sheets information consistent with the IMF’s Government Financial Statistics Manual, 2014. The options have significant implications for policy advice and development cooperation for meeting global climate change goals while ensuring sustainable employment generation with transparency and accountability.


Keywords


investment; human capital; taxation and subsidies; intergovernmental fiscal relations; environmental policy

Full Text:

PDF

References


Ahmad E (2017). “Rebalancing in China: Fiscal policies for sustainable growth”. The Singapore Economic Review, 63(4): 861–884. https://doi.org/10.1142/S0217590817420085.

_____ (2020). “Multilevel responses to risks, shocks and pandemics: Lessons from the evolving Chinese governance model”. Journal of Chinese Governance. https://doi.org/10.1080/23812346.2020.1813395.

Ahmad E, Bordignon M and Brosio G (2016). “Introduction: How multi-level finance has contributed to the crisis and is affected by it”. In: Ahmad E, Bordignon M and Brosio G (eds.), Multilevel Finance and the Crisis in Europe: Causes and Effects. Cheltenham, UK: Edward Elgar. https://doi.org/10.4337/9781784715113.00005.

Ahmad E and Colenbrander S (2020). Financing A Sustainable and Inclusive Urban Transition in China. Washington, DC, USA: Coalition for Urban Transitions.

Ahmad E, Niu M, Wang L and Wang M (2020). “Designing beneficial property taxation for sustainable development in China—Evidence from six cities, including Guangzhou”. LSE/CUT Program on Financing Sustainable Urban Transitions in China and Mexico. London, UK: London School of Economics.

Ahmad E, Niu M and Xiao K (2018). “Introduction”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong. Singapore: Springer.

Ahmad E, Rydge J and Stern N (2013). “Structural change leads to tax reforms leads to structural change”. LSE ARC and China Development Forum, March 2013.

Ahmad E and Zhang X (2018). “Towards monitoring and managing subnational liabilities in China: Lessons from the balance sheet for County K”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong. Singapore: Springer.

_____ (2020). “Managing subnational liabilities in China—The importance of balance sheet information”. LSE/CUT Program on Financing Sustainable Urban Transitions in China and Mexico. London, UK: London School of Economics.

Coalition for Urban Transitions (2019). Climate Emergency, Urban Opportunity: How National Governments Can Secure Economic Prosperity and Avert Climate Catastrophe by Transforming Cities. London, UK, and Washington, DC, USA: World Resources Institute (WRI) Ross Center for Sustainable Cities and C40 Cities Climate Leadership Group. Final Accounts 2014–2017. Guangzhou, China: Guangzhou Municipal Government.

Lamb WF, Creutzig F, Callaghan MW and Minx JC (2019). “Learning about urban climate solutions from case studies”. Nature Climate Change, 9: 279–287. https://doi.org/10.1038/s41558-019-0440-x.

Lu H, Yue A, Chen H and Long R (2018). “Could smog pollution lead to the migration of local skilled workers? Evidence from the Jing-Jin-Ji region in China”. Resources, Conservation and Recycling, 130: 177–187. https://doi.org/10.1016/j.resconrec.2017.11.024.

Luo X and Zhu N (2018), “Hub-periphery development pattern and inclusive growth: Case study of Guangdong Province”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong. Singapore: Springer.

_____ (2020). “Migration, city attractiveness and regional hubs in China”. LSE/CUT Program on Financing Sustainable Urban Transitions in China and Mexico. London, UK: London School of Economics.

Oates L, Dai L, Sudmant A and Gouldson A (2020). Building Climate Resilience and Water Security in Cities: Lessons from the Sponge City of Wuhan. Washington, DC, USA: Coalition for Urban Transitions.

State Council (2020). Directives on Formulating the 14th Five Year Plan and Long-Term Goals for 2035. 5th Plenary of CPC Central Committee, October 29. Beijing, China: The State Council, The People’s Republic of China.

United Nations Department of Economic and Social Affairs (UN DESA) (2018). World Urbanization Prospects 2018. New York, NY, USA: UN DESA. http://esa.un.org/unpd/wup/.

Wang W, Wu A and Ye F (2018). “Land use reforms: Towards sustainable development in China”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Policies for Sustainable Development in China—Rebalancing in Guangdong. Springer. https://doi.org/10.1007/978-981-10-6286-5_2.

World Health Organization (WHO) (2018a). “Ambient air pollution”. World Health Data Platform. Geneva, Switzerland: WHO.

_____ (2018b, May 2). “Ambient (outdoor) air pollution”. WHO Fact Sheets. Geneva, Switzerland: WHO. https://www.who.int/news-room/fact-sheets/detail/ambient-(outdoor)-air-quality-and-health.

Xiao K (2018). “Managing sub-national liability for sustainable development: A case study of Guangdong Province”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong. Singapore: Springer. https://doi.org/10.1007/978-981-10-6286-5_7.

You H, Wu X and Guo X (2020). “Distribution of COVID-19 morbidity rate in association with social and economic factors in Wuhan, China: Implications for urban development”. International Journal of Environmental Research and Public Health, 17(10): 3417. https://doi.org/10.3390/ijerph17103417.

Yuan X (2018). “BRTs and investment fads: Civic engagement and fiscal discipline”. In: Ahmad E, Niu M and Xiao K (eds.), Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong. Singapore: Springer. https://doi.org/10.3390/su11030742.




DOI: http://dx.doi.org/10.24294/jipd.v5i1.1251

Refbacks

  • There are currently no refbacks.


Copyright (c) 2021 Ehtisham Ahmad

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Creative Commons License
This site is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.