Quick Take: China Expands Bonds to Agriculture, Other Projects

Photo: Visual China
Photo: Visual China

China’s state planner has expanded the uses of project bonds to cover the funding needs of public health, social welfare and agricultural projects.

In China and elsewhere, project bonds offer an alternative funding avenue for social-impact and infrastructure projects that have a longer economic life or require longer loan tenors to cover the high upfront cost of investment.

Project bonds in China also have helped local governments and corporations improve their fiscal discipline and transparency by giving them the ability to convert off-balance-sheet spending into on-budget debts.

On Thursday, the National Development & Reform Commission (NDRC), China’s economic planner, issued new guidelines on project bond financing for clinics and hospitals, sports stadiums, as well as the elder care, education, culture, tourism and farming industries.

Projects in these categories can receive faster regulatory approval if they are funded through project bonds, the NDRC said.

The planner also encourages the use of a hybrid of bank loans and project bonds to fund these social projects.

In June, the government introduced land reserves bonds, the country’s first-ever project bond. Since then, it has been expanding the use of project bonds to cover to other types of infrastructure including parking lots, toll roads and power plants.

Contact reporter Aries Poon (

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