China's outstanding local government debt was 18.29 trillion yuan ($2.65 trillion) as of the end of November, down from 18.40 trillion yuan in October, showcasing efforts in financial deleveraging.
General debt used for constructing public facilities totaled 10.86 trillion yuan, and special debt set for special projects was 7.43 trillion yuan, data from the?Ministry of Finance?(MOF) showed on Wednesday. About 98 percent of this debt was held in the form of bonds.?
The local government debt was within the range of 21 trillion yuan approved by the National People's Congress - the country's top legislature - for 2018, according to a statement on the website of MOF.
Jiang Zhen, a research fellow at the National Academy of Economic Strategy at the Chinese Academy of Social Sciences, said that the declining volume of outstanding debt reflected effective management schemes imposed by the central government to rein in local government debt.
"This shows the risk is within control and measures such as the overall budget, legal means and standardized management to contain local debt growth have proved effective," Jiang told the Global Times on Wednesday.
The reduction in the local debt balance also counters market concerns about China's growing local debt, which some analysts said could pose rising financial risks and weigh on China's economy.?
Leslie Maasdorp, vice president and chief financial officer of the New Development Bank, also told the Global Times in an earlier interview that as Chinese local governments are using the debt to build roads and improve services that raise the productivity of the Chinese economy, the local debt could be "sustainable."
From January to November, China has issued local government debt totaling 4.10 trillion yuan, according to the MOF.?
