Chinese Local Governments Issue a Record 66.5 Billion Yuan in Bonds in August

»Chinese local governments have sold 66.5-billion-yuan worth of government bonds in August, the highest since 2009.

»Chinese local governments have sold 66.5-billion-yuan worth of government bonds in August, the highest since 2009 when local governments were authorized to tap into debt investment.

»In April 2009, the value of local government debt reached record 59.4 billion yuan, as part of a CNY4 trillion ($586 billion) economic stimulus plan announced by the Chinese government in November 2008 in its biggest move to stop the global financial crisis from hitting China.

»China’s Finance Ministry issued new rules regulating local government financing vehicles in mid-August, which, according to analysts, entitles local government more power to issue bonds.

»The expanding of local government bonds enhances liquidity and will further clarify credit risk premium, according to Wang Haoyu, head of First Venture Securities Research Institute.