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Local Governments Must Avoid New Implicit Debts In Housing Acquisition

CHINA PRESS
MNI (Singapore)

City governments should select no more than two local SOEs as acquisition entities to buy up completed-but-unsold housing from developers for social housing programmes, and strictly avoid adding new implicit debts of local governments, said Zou Lan, director of the Monetary Policy Department at the People's Bank of China Wednesday. The selected SOEs must not be local government financing vehicles and meet the credit requirements of commercial banks. Loan funds obtained by SOEs must be accounted for separately and managed in a closed manner. Developers shall first repay the debts of projects with those sales revenue. (Source: 21st Century Business Herald)

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