MNI China Press Digest August 29: U.S., Special Bonds, Macro

Highlights from Chinese press reports on Tuesday:

• China and the U.S. agreed to create a working group to find solutions to specific business issues and exchange export control information. Senior government officials and representatives from the private sector will participate in the new working group, and meetings will be held twice a year at the vice-ministerial level, according to a statement issued after the meeting between Chinese Commerce Minister Wang Wentao and U.S. Commerce Secretary Gina Raimondo in Beijing on Monday. The two ministers agreed to communicate regularly and meet at least once a year. (Source: Ministry of Commerce website)
• China issued 174 new special bonds in August worth CNY476.7 billion, more than double July’s CNY196.2 billion, according to Securities Daily. Wang Qing, chief macro analyst at Dongfang Jincheng, said authorities had postponed issuance of some bonds from July into August under the expectation of lower interest rates. Authorities should now use government spending to attract private investment into major infrastructure projects, which will alleviate local government debt and boost market confidence, Wang said. Between January-July, infrastructure investment increased by 6.8% y/y, 3.4 pp higher than overall fixed-asset investment. (Source: Securities Daily)
• China will increase the intensity of macro policies and expand domestic demand, to boost confidence and prevent risk, said Finance Minister Liu Kun. The ministry will improve the implementation efficiency of proactive fiscal policy and speed up fiscal spending. Local governments will have issued this year's new special bonds before the end of September and they will use the funds for project construction by the end of October. The ministry will expand the scope of fund use to help drive private investment, strengthen project reserves and post-investment management. (Source: Xinhua News Agency)