CitytoraiseRMB30bforprojects
From: Shenzhen Daily
Updated: 2009-02-26 00:02
SHENZHEN plans to raise 30 billion yuan (US$4.4 billion) through bonds this year to make up for a budget shortage for expenditure on infrastructure, improvement in residents" livelihoods and subsidies for industries.
Qiao Jiahua, director general of the city"s finance bureau, told the local legislature yesterday the proposal had yet to be approved by the Ministry of Finance.
Shenzhen will spend 59.66 billion yuan on 842 projects this year, almost double the 2008 figure, to spur a slowing economy.
"We estimate a deficit of 33 billion yuan in the largest-ever economic stimulus plan, and are working hard to raise funds through multiple channels," Qiao said.
The city was facing an unprecedented challenge as government revenue had declined, Qiao said.
The Central Government announced earlier this month that bonds worth 200 billion yuan would be issued on behalf of cash-strapped local governments to fund public welfare projects.
The State Council has issued a circular directing all provincial and autonomous region governments to submit their funding requirement by March.
The Ministry of Finance will act as the bond-issuing agent and distribute interest payments on behalf of local governments.
The circular stated that the bonds would mature in three years and that local governments would pay the principal interest and issuing costs. Payments would be deducted directly from local treasury accounts at the end of a year.
To spur a slowing economy, China late last year launched a stimulus package worth 4 trillion yuan, of which 1.18 trillion would come from the Central Government.
The remainder would be funded by local governments and companies.
Shenzhen Daily