Local Governments in China Cut Back Borrowing, Forcing Beijing to Shoulder More Debt Burden

China's local governments appear reluctant or unable to borrow more despite pressure to stimulate growth, raising expectations of more central government debt
Regional authorities plan to issue 1.08 trillion yuan ($150 billion) in new bonds in Q1 2023, 13% less than last year
Actual new bond issuances have fallen even more, down 56% in the first 8 weeks of 2023 compared to 2022
Slower local bond supply increases likelihood of central government taking on more leverage to fill investment gap
Wealthier areas struggling to find productive projects to invest in; some repaying bonds early to save interest costs