Under a pilot scheme, the first group of six provinces and cities sold 6.8 billion yuan in bonds
at commercial bank counters to individual buyers between March 22 and early April.
The coupon rates are between 3.01 percent and 3.33 percent, higher than treasury b
onds issued by the central government as well as bank deposits with the same maturity.
Gross local bond issuances hit 1.18 trillion yuan in the first qua
rter, compared with only 219.5 billion yuan in the same period last year.
The total quota for 2019 local government bond issuances is 3.08 trillion yuan, according to the Ministry of Finance.
“About 60 percent of the bonds were issued for ongoing construction, especially
for shantytown renovation projects, railways and roads,” said Hao Lei, head of the ministry’s Budget Department.
While debt financing continues to grow, the government is experiencing sharp declin
es in fiscal revenue growth, especially from tax and land sales, official data showed.
tment, and it could also leverage on more bank lending and attract private funds to increase investment, said Xu.
In the meantime, allowing retail access to local government bonds will help diversify the
investor base and increase market liquidity, said Amanda Du, an analyst at Moody’s Investors Service.
The analyst expected access for retail investors to widen to encompass all local government bonds in 2020.
hina’s economy grew at a faster-than-expected 6.4 percent year-on-year in the first qua
rter, according to data released by the National Bureau of Statistics on Wednesday.
The growth was unchanged from that registered in the fourth quarter of last year.
The country’s industrial output posted steady growth in the same period, up by 6.5 percent
year-on-year, compared with 5.7 percent in the previous quarter, official data showed.
Fixed-asset investment growth was 6.3 percent in the first quarte
r, compared with 6.1 percent in the first two months, according to the NBS.
Retail sales increased by 8.3 percent year-on-year in the same pe
riod, compared with 8.2 percent in the first two months, the data showed.
hina’s economic growth will remain stable in the first quarter, and is expected to land at 6.3 percent or even higher year-on-year when it is released this week, e
conomists said after some economic indicators for March surprised the market on the upside.
“Downside pressure began to ease in the first quarter, as signaled by the r
ather substantial recovery in various economic indicators in March,” said Yao Jingyuan, form
er chief economist at the National Bureau of Statistics and a researcher for the Counselors’ Office of the State Council.
Chinese banks’ lending in yuan, a leading indicator for the real economy
, surged in March by 1.69 trillion yuan ($252 billion), up 52 percent from a year earli
er, according to the People’s Bank of China, the central bank. The manufacturing purchasing managers inde
x for March, which was back into expansion territory, may be a sign of accelerating industrial activities.
Exports in March also picked up, rising 14.2 percent in US dollar ter
ms from a year ago, versus 0.1 percent for the January-February period, customs data showed.