MNI China Press Digest June 30: Debt Risk, FTZs, HK/Mainland

Highlights from Chinese press reports on Friday:

• China should establish a government debt repayment reserve fund to prevent default risks, according to a report published by the National People's Congress Financial and Economic Affairs Committee on Thursday. The balance of local government special bonds has exceeded CNY22 trillion after years of expansion in infrastructure projects, while the repayment risks increased with declining revenues from land sales in recent years. China should raise the warning line of the local government debt ratio to 150%, as the current ratio has exceeded 120% in many regions, said Zhao Quanhou, a researcher at the Chinese Academy of Fiscal Sciences. (Source: 21st Century Business Herald)
• China will introduce new measures to promote the high quality opening up of free trade zones (FTZs), according to recent plans from the State Council. Officials said China will expand the scope of financial services that foreign firms can provide within FTZs, and widen tariff exemption rules for various products and services. Foreign firms will benefit from harmonized treatment for government procurement projects and a relaxation of business and spouse visas. The State Council said authorities would take targeted measures to boost residents' consumption, and coordinate cross government policy for renovating old age housing. (Source: 21st Century Herald).
• Officials from the Beijing and Hong Kong stock exchanges have signed an agreement to facilitate the listing of companies across platforms, according to a joint statement. Policymakers said Beijing listed firms will benefit from improved access to international capital markets and can further develop as a center for international science and technology innovation. Hong Kong will further enhance its status as an international financial hub and gateway to China’s capital market, officials said. (Source: Yicai)