Local task forces and financial institutions in China need to strengthen their sense of responsibility and urgency in ensuring project deliveries for several reasons, particularly in the context of the property market:
1. Preventing Social Instability: The delayed or failed delivery of real estate projects can lead to widespread dissatisfaction among homebuyers. Many people in China purchase homes before they are built, and when developers fail to deliver, it can cause social unrest, protests, and loss of public trust.
2. Mitigating Economic Risks: The property sector is a significant part of China's economy, and problems in this sector, such as project defaults or insolvencies, can ripple through the financial system. If these projects are not completed, it could lead to a financial crisis, as both developers and buyers rely heavily on loans.
3. Restoring Confidence in the Market: The real estate market in China has been facing challenges, including debt crises among major developers like Evergrande. Strengthening responsibility can help restore market confidence, encourage investment, and stabilize property prices.
4. Addressing the Debt Issue: Many developers are deeply in debt, and ensuring project deliveries can help prevent further defaults. By delivering projects, developers can generate the revenue needed to repay loans and avoid worsening the financial instability of banks and other lenders.
5. Supporting Government Policy: The Chinese government has made efforts to stabilize the property market, promote healthy economic growth, and ensure social welfare. Local task forces and financial institutions need to act quickly to align with these policies, ensuring that delayed or stalled projects are completed efficiently.
In summary, ensuring project deliveries is crucial to maintaining economic stability, preventing financial crises, and avoiding large-scale public dissatisfaction in China's real estate sector.
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