BEIJING — China’s government debt risk is “largely controllable” and authorities have rolled out new measures to strengthen local government debt management, Zhang Shaochun, vice minister of finance, said on June 23.
Zhang made the remarks when delivering a State Council report on the final accounts for 2016 to the Standing Committee of the National People’s Congress (NPC) during its bimonthly session.
“Fresh steps have been taken to better manage China’s local government debt, with strengthened supervision efforts on local financing platforms and the establishment of cross-department surveillance and risk prevention schemes,” Zhang said.
By the end of last year, combined debt of central and local governments in China stood at 27.3 trillion yuan (about $4 trillion), with a debt-to-GDP ratio at around 36.7 percent, official data showed.
The central government was improving the information disclosure of local government financing activities and continued to hold officials accountable for illegal financing activities, he added.
Public-private-partnerships will also be carried out in a more standardized manner, he stressed.
Chinese financial regulators are increasing financial risk control and deleveraging, as solid economic growth in the first quarter provided more room for such adjustments, conducive to long-term growth.
Central government departments in 2016 spent 4.83 billion yuan on the “three public consumptions”: overseas trips, vehicles and receptions, down 10.2 percent from 2015, Zhang said.