China Local Governments to Sell $206 Billion of Financing Debt

China is considering providing cheap funding to local government financing vehicles (LGFVs) in an effort to address debt concerns and improve their cashflow amid mounting risks, according to reports, with the central bank potentially setting up an emergency liquidity tool to provide low-cost, longer-term funds. The move comes as authorities also mull plans to cut LGFV debt, including allowing provincial-level governments to raise about 1 trillion yuan through special bonds sales to repay the debt of LGFVs and other off-balance sheet issuers. The measures are part of China's efforts to address the major economic and financial risks posed by LGFV debt.

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Posted 8/21/2023, 10:19:40 AM

China Local Governments to Sell $206 Billion of Financing Debt

yahoo.com

Relevant topic timeline:

8/21/2023

China's state banks seen mopping up offshore yuan liquidity - sources

China's major state-owned banks are actively acquiring offshore yuan liquidity, raising the cost of shorting the Chinese currency and potentially stabilizing the yuan.

8/21/2023

Amid China’s economic woes, US can gain clout with indebted countries: analysts

8/24/2023

China’s ticking debt dilemma: the longer they wait, the bigger the cost

China's local government debt has reached a record 66 trillion yuan ($9 trillion), prompting Beijing to seek a comprehensive solution to the crisis.

8/24/2023

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9/1/2023

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China Faces Mounting Debt Crisis as Local Governments Struggle with $8 Trillion in Off-Book Borrowing

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China's Economy Shows Signs of Improvement in August with Increased Credit and Government Support

9/20/2023

China's Hidden Local Debt Crisis Balloons to Trillions as Authorities Scramble for Solutions