Chinese Cities Lack Fiscal Transparency, Study Shows

15 June 2012

Most Chinese cities lack fiscal transparency, according to a survey conducted by Tsinghua University and described in a Xinhua article.

Only seven of the 81 city governments met the basic requirements on fiscal transparency, according to the survey released June 12.  Xinhua reported:

The survey examined the 2010 fiscal disclosures of four municipalities as well as 77 city governments in 22 provinces and five autonomous regions on eight criteria, including whether they had released information on government structures and functions, whether they had published 2011 budget reports and whether they had publicized their final accounts for 2010.

“City governments were not as transparent as people expected,” said Yu Qiao, professor of economics in the School of Public Policy and Management at Tsinghua University, as well as the head of the research team.

Beijing topped the fiscal transparency ranking, followed by Shanghai, Nanyang and Chengdu, while Baotou, Qingyang and Shihezi were among the lowest-ranked city governments.

The survey showed that per capita GDP, foreign trade dependence and the educational background of top city officials were three main factors influencing city governments’ fiscal transparency.

“The higher the per capita GDP and the larger the foreign trade dependency cities have, the more transparent their finances will be,” Yu said.

“Top city officials with formal college degrees are more inclined to support information disclosure,” he said.

Most of the surveyed city governments did a good job of publicizing budget information, but only a few released their final accounts.

However, none of the 81 cities surveyed publicized their extra-budgetary expenditures, according to the survey.

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