Bond issuance to relieve local government burdens

Local authorities are facing a decrease in government revenues due to economic pressures in the coming year. A new government proposal to allow them to issue bonds could provide them relief.

Government revenues, such as tax, land fees, and central government subsidies, are already declining in some regions and are expected to decline further. As local authorities mainly rely on central government revenue to finance their expenditure, bond issuance would certainly help to alleviate financial burdens on local governments, said Hubert Tse, managing director and head of Yuan Tai PRC Attorneys.