While Washington Spends, China Moves to Cut Its $30 Trillion Debt Load

Take a spin around Tianjin’s Binhai New Area, a massive development project about an hour from Beijing, and you’ll see one partially finished building after another—and empty storefronts with black crosses painted on glass doors. Conceived as a futuristic financial hub and business center on par with Shanghai’s Pudong district or New York City, Binhai hasn’t yet lived up to the hype. “Only about one-third of the apartments here are occupied,” estimates Liu Yulan, 75, who moved to the area to be closer to her daughter-in-law. “I don’t see Binhai becoming a boom town.”

In January, Binhai government officials made a startling admission. The region was revising down its 2016 gross domestic product—by about 30 percent, to 665.4 billion yuan ($104.9 billion). That news followed revelations of creative accounting by two northern provincial governments: Liaoning and Inner Mongolia, both of which have been hit hard by recent downturns in steel, oil, and coal prices.