China May local govt special bond issuance at 452.4 billion yuan

China May local govt special bond issuance at 452.4 billion yuan

China's local governments issued 452.4 billion yuan (US$70 billion) in special bonds in May, compared with 343.9 billion yuan the previous month, the finance ministry said on Monday.

FILE PHOTO: Illustration photo of a China yuan note
FILE PHOTO: A China yuan note is seen in this illustration photo May 31, 2017. REUTERS/Thomas White/Illustration

BEIJING: China's local governments issued 452.4 billion yuan (US$70 billion) in special bonds in May, compared with 343.9 billion yuan the previous month, the finance ministry said on Monday.

In the first five months, local governments issued a total of 1.17 trillion yuan in special bonds, the ministry said in a statement on its website.

The January-May issuance accounted for about 32per cent of the annual quota of 3.65 trillion yuan.

Analysts expect the pace of bond issuance to pick up in the coming months as more spending will be needed to support the economy, which is slowing from a record 18.3per cent expansion in the first quarter.

Policymakers, while promising to maintain fiscal support for the economy, have cautioned against potential risks caused by rising local government debt, including implicit debt.

Local governments issued bonds, including special bonds, totaling 875.3 billion yuan in May, up from 775.8 billion yuan in April.

Outstanding local government debt was 27.19 trillion yuan at the end of May, the ministry added.

(US$1 = 6.4670 Chinese yuan renminbi)

(Reporting by Colin Qian and Kevin Yao; Editing by Toby Chopra and Steve Orlofsky)

Source: Reuters

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