The Relationship between Central and Local Governments in China: A Case Study of Yunnan Province

Abstract

The People’s Republic of China is a socialist country with a unitary state structure. The country is under the administration of the central government. The Chinese constitution sets five state power levels: the central government, local government at the provincial level, local government at the municipal level, local government at the county level and the local government at the sub-district and township level. Each state power has its own financial system. China’s financial that is a system of “the one upper level managing one lower level”, which are consistent with the vast territory of China. Local government can determine appropriate management methods according to their local conditions for making local economic, social and cultural operations effective and up to date. The financial situation of Yunnan Province has still needed financial support from the central government for paying salaries to Yunnan government officials in order to let the organization operate normally. Moreover, the central government has established the office of special finance inspectors at the provincial level across the country for audit the local government’s finance.