China’s local governments raise money to often fund infrastructure projects, but there are concerns about rising debt levels. Photo: Xinhua
China’s local governments raise money to often fund infrastructure projects, but there are concerns about rising debt levels. Photo: Xinhua

Explainer |
Is China’s local government debt a concern and what role do LGFVs play in infrastructure spending?

  • Local government bonds reached 28.6 trillion yuan (US$4.5 trillion) at the end of September, accounting for 23 per cent of the all the listed bonds in China by volume
  • Local government hidden debts, mainly LGFV debts including loans and bonds, reached 45 trillion yuan (US$7 trillion) at the end of 2020, according to estimates

Topic |   China economy
China’s local governments raise money to often fund infrastructure projects, but there are concerns about rising debt levels. Photo: Xinhua
China’s local governments raise money to often fund infrastructure projects, but there are concerns about rising debt levels. Photo: Xinhua
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