China's LGFV Debt Rises to Record on Loose Liquidity: Newspaper

Debt raised through China’s so-called local government financing vehicles rose to CNY5.1 trillion this year, CNY400 billion more than the previous record, as loose liquidity helped these entities owned by local authorities borrow more funds, the 21st Century Business Herald said using data by Wind. As usual, most of the money raised was for repaying debt and the net capital raised, at CNY1.65 trillion, was lower than that of 2020, it said. Under China’s tiered management of these debt instruments, the proportion of lower-credit debt has declined, the more developed regions are raising more debt while debt by those of low credit standings has sharply fallen, said the newspaper. As of Nov. 28, China’s outstanding LGFV debt stood at CNY12.75 trillion, the newspaper said.