A researcher with China’s Academy of Social Sciences said Dubai’s debt crisis should be a “wake-up call” for China, which needs to prevent a similar situation in its “speculation-driven” property market.
Yi Xianrong, a researcher at the academy’s Institute of Finance and Banking, wrote in the China Daily newspaper that a Dubai-like crisis is unavoidable if China continues to regard development of its property sector as a prerequisite for economic growth and land sales remain a main source of local government revenue.
Yi wrote that the government should take measures to check housing investment and speculation, and only allow preferential lending for people who will occupy the homes they buy.
Gulf Times reports that, according to the China Daily, businessmen from the eastern Chinese city of Wenzhou invested $732 million in Dubai and stand to lose more than $150 million.
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