China’s total government debt hit RMB 102.5 trillion by end-2025 (statutory 68.5 percent of GDP; 73.2 percent including hidden debt), with local statutory debt still the largest share. Debt swaps eased short-term pressure, but land revenue fell 28.6 percent in early 2026 while interest costs rose, shifting the problem from avoiding defaults to sustaining cash flow. Public finance must now treat assets as productive capital—using REITs, equity and other market tools—because the old land-finance, high-growth model no longer absorbs the debt [...]