MNI BRIEF: China Speeds Up Debt Issuance In H1, Revenue Down

China accelerated issuance of government bonds to boost the economy and swap local government hidden debt in the first half of the year while fiscal revenue saw declines, Ministry of Finance officials told reporters on Friday. 

Treasury issuance reached CNY7.88 trillion in H1, a record high for the period, officials said, noting the average issuance rate was 1.52%, down 43 basis points from the same period last year. A total of CNY2.6 trillion in local government general and special bonds was issued to support major projects and CNY162 billion in ultra-long-term special government bond funds were allocated to boost consumption.

CNY1.8 trillion in refinancing bonds were issued to swap for local government debt, officials said, significantly reducing interest expenses.

In H1, financial revenue totaled CNY11.6 trillion, down 0.3% year-on-year, of which tax revenue amounted to CNY9.3 trillion, a decrease of 1.2%, with corporate income tax totaling CNY2.5 trillion, down 1.9%.  (See MNI: China’s Tax Revenue Fall Expected To Continue In H2)