Local bond issuance backed in FTZs

Source: Xinhua | 2017-02-22

CHINA will encourage local governments to issue bonds in free trade zones this year, the Ministry of Finance said yesterday.

Governments of regions with mature conditions can “actively” issue bonds in FTZs, according to a circular released by the ministry.

Local officials were also told to attract more foreign-funded financial institutions to participate in underwriting.

To rein in rising debt risks, China overhauled the management of government bonds in 2014, streamlining fundraising channels for local authorities while putting a cap on annual bond issues.

New local government bonds cannot exceed the annual caps, the ministry said.