Local Government Financing Firms Face Record Bond Repayments in 2024

(Bloomberg) — China’s local government financing vehicles need to pay back a record amount of maturing local bonds this year, testing the limits of a central government program to help them refinance their debt and avoid default.

The nation’s LGFVs — the companies that borrow on behalf of provinces and cities to finance mainly infrastructure projects, such as roads and ports — have 4.65 trillion yuan ($651 billion) worth of bonds due over the next 12 months, according to Bloomberg-compiled data. That’s the highest amount on record, and is roughly 13% more than what came due last year.