THE Chinese Government has blocked all new stock and bond issues until its 30 billion yuan (about HK$40.74 billion at official rates) 1993 treasury bond issue has been fully subscribed, government sources said yesterday. So far only four billion yuan worth of the bonds issued by the Ministry of Finance on March 1 have been sold and the government has been forced to extend the two month issuance period indefinitely. In order to ensure that the treasury bonds are fully subscribed to, the State Council has issued a circular which states that there is to be ''no public offering of debt or equity'' until the bonds have been sold out. The nine mainland companies seeking a listing on the Hongkong stock exchange will not be affected by the new rule since their shares cannot be purchased by mainland residents. The government has been forced to take such drastic action, analysts say, because of the dismal performance of its 1993 bonds on the domestic securities market. The price of the bonds had fallen beneath their face value at most trading centres around the country and trading had generally been in the doldrums, the official China Daily newspaper said yesterday. The city of Shanghai, for example, which was required to sell 1.75 billion yuan worth of treasury bonds this year, had so far achieved sales of only 250 million, the newspaper said. Mainland investors started turning away from government bonds in the middle of last year when far more attractive securities became available on the Shanghai and Shenzhen stock exchanges. The 1993 five-and three-year treasury bonds carry coupons of 11 and 10 per cent, respectively, 0.5 percentage point higher than last year's offering but still a long way behind the high flying stocks of Shanghai and Shenzhen. Furthermore, with inflation in major cities running at more than 15 per cent, analysts say it is simply not worth it to buy treasury bonds. ''The government will have to significantly raise the coupon on its short term bonds if it is going to attract investors back from the stock market,'' one securities analyst said. ''But given that the Ministry of Finance is very concerned about government over-borrowing right now, I don't see that happening.'' Most analysts agreed that the government had little option but to resort to coercive measures if all this year's bonds were to be sold. ''Treasury bonds just can't compete in the current market so it is not really surprising that the government stepped in to temporarily remove the opposition,'' a Western banker in Beijing said. However, even with the ban on new debt and equity offerings in place, it is doubtful the government will be able to shift its outstanding 26 billion yuan worth of bonds on the open market. ''I think we will see a return to the bad old days when state-run enterprises and institutions were simply ordered to buy government bonds whether they liked it or not,'' the banker said.