Chinese local governments rush to issue bonds for debt repayment

Several Chinese local governments, including Liaoning and Chongqing, have announced plans to issue refinancing bonds to repay existing debt, as part of efforts to reduce debt risks in China’s economy. This follows similar announcements by Tianjin and Inner Mongolia, and could boost investor confidence in bonds issued by local government financing vehicles (LGFVs). However, some analysts warn that the planned refinancing bonds are just a small portion of China’s total local government borrowing, and that there are still risks involved for creditors.