Opinion: To Make the Most of Special-Purpose Bonds, Greater Focus on Performance Is Needed

By Caixin

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Project progress, returns and debt repayment plans are crucial indicators of the performance of special-purpose bonds. Photo: VCG

Since the start of this year, market observers have noted a slowdown in the issuance of local government special-purpose bonds (SPBs). From January to March 2024, the issuance of new SPBs was just over 600 billion yuan ($82.8 billion), a reduction of more than 50% compared to the 1.36 trillion yuan issued in the first quarter of 2023. This accounts for nearly 17% of the new annual limit and 40% of the total local bond issuance for the quarter, marking a significant decline. According to the budget plans, the issuance limit for local government SPBs in 2024 is set at 3.9 trillion yuan, an increase of 100 billion yuan from the previous year.