The General Office of the Central Committee of the Communist Party of China ("CPCCC") and the General Office of the State Council have recently issued the Circular on Working Effectively on the Issuance of Special Local Government Bonds and the Supportive Financing for Projects (the "Circular").
The Circular sets out requirements for relevant work, in aspects of supporting the financing work for special bond projects, further improving administration of special bonds and supporting measures, moving forward with financing for major public-interest projects (the "major projects") in compliance with laws and regulations, and reinforcing organizational guarantee. Among others, the Circular calls for great efforts to introduce and promote special bond projects, ensure the financing matches the solvency in special bond projects, strengthen credit ratings and differentiated pricing, raise the degree of marketization of local government bonds pricing, increase the diversity of groups investing in local government bonds, raise the percentage of long-term special bonds to a proper extent, and expedite the issuance and use of special bonds. Furthermore, the Circular underscores the support for major projects to seek financing in a market-based manner, the proper guarantee of a necessary amount of subsequent financing for projects under construction, and the raising of capital funds for major projects in various channels.