December 30, 2018 / 2:21 AM / 3 months ago

China approves early 2019 local govt debt issue

SHANGHAI, Dec 30 (Reuters) - China will allow local governments to issue debt earlier than normal next year, the official Xinhua news agency said, amid a push by Beijing to revive flagging economic growth.

The State Council approved a 2019 quota for new local government bond issuance of 1.39 trillion yuan ($202.17 billion), enabling local authorities to start issuing debt from January.

Local government bond issuance typically begins in March, following approval of quotas at the National People’s Congress.

Reuters reported earlier this month, citing sources, that China was planning to begin issuing new local government bonds for 2019 in January, as the authorities try to counter slowing growth hit by the Sino-U.S. trade war.

China’s leadership said this month that the country would increase its quota of local governments’ special bond issuance by a relatively large scale next year to help resolve financing difficulties for small and private firms.

Xinhua said on Saturday early approval would help local governments move forward quickly with projects and create a stable investment environment.

“It must, and it can, bolster domestic demand... and help ensure continued healthy economic development,” it said. (Reporting by Adam Jourdan; Editing by Nick Macfie)

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