Relaunch of special government bonds after 13 years is expected to reach 4 trillion yuan
Our reporter Meng Ke
At the critical moment of the new crown pneumonia epidemic superimposed on China's economic transformation, China once again proposed to issue special government bonds. The meeting of the Political Bureau of the Central Committee of the Communist Party of China held on March 27 pointed out that it is necessary to strengthen the adjustment and implementation of macro policies, and to study and propose a package of macro policies and measures that are actively responded to. More flexible and appropriate, appropriately increase the fiscal deficit rate, issue special government bonds, increase the scale of local government special bonds, guide the decline in interest rates on the loan market, and maintain reasonable and sufficient liquidity.
The chief analyst of fixed income of CITIC Securities clearly stated in an interview with the "Securities Daily" reporter that as a powerful grasp of fiscal policy, the market some time ago had expectations of raising the deficit rate and increasing the local government's special debt quota. The meeting proposed the issuance of special government bonds, which will help proactive fiscal policies become more active and promising.
It is understood that China has previously issued two special government bonds, in 1998 and 2007, respectively. Feng Lin, a senior analyst in the research and development department of Dongfang Jincheng, told the Securities Daily reporter that in 1998, in order to solve the problem of insufficient bank capital, the Ministry of Finance issued 270 billion yuan of special government bonds to the four major banks. In 2007, the issuance of special government bonds was 1.55 trillion yuan (of which 1.35 trillion yuan was issued to the Agricultural Bank of China, which was not listed at the time, and then purchased by the central bank from the Agricultural Bank of China, which is actually equivalent to central bank investment). Foreign exchange, as a source of capital for the establishment of the National Foreign Exchange Investment Corporation. In addition, some of the special government bonds issued in 2007 expired in 2017, and the Ministry of Finance launched a targeted renewal, with an issuance of 600 billion yuan.
Judging from the timing and effectiveness of the first two special government bonds, special government bonds have played a huge role in stimulating domestic demand and stimulating consumption as a positive fiscal measure to hedge against economic fluctuations, maintaining a relatively stable and rapid development of the domestic economy.
Feng Lin said that the special characteristics of special government bonds are reflected in the following aspects: first, special government bonds are issued for specific purposes at special times, not regular financial tools, and are emergency measures; second, special government bonds are included in the central government's national debt balance management It is not included in the fiscal deficit, and its revenue and expenditure are included in the budget of the central government fund. Third, the use of funds for special government bonds is not uniformly and clearly defined. Instead, special arrangements are made according to the actual policy at the time of issue, and the use of funds is more flexible.
Wu Yongzu, deputy director of the Industry Department of the Chongyang Institute of Finance of Renmin University of China, told a reporter from the Securities Daily that special government bonds are issued for a specific purpose. It does not increase the debt of local governments and is more flexible. Although the specific purpose of this special treasury bond issue has not been publicly stated, the purpose is to hedge the impact of the new crown pneumonia epidemic on the economy. It should be mainly used to support small and medium-sized enterprises and increase the consumption capacity of residents.
Obviously, in the face of the new crown pneumonia epidemic and the pressure of global economic growth, the size of this special government bond is expected to exceed history, and the issuance method is likely to be divided into wholesale banks, and the project will also be more abundant.
Feng Lin said that considering the impact of the new crown pneumonia epidemic on the macro economy this year and the effect of policy hedging, the scale of this special treasury bond is expected to reach the trillion-dollar level-preliminary estimates are likely to reach 2 trillion to 4 trillion , Which is about 2.0% to 4.0% of GDP.
Wu Yongzu believes that in view of the severe impact of the new crown pneumonia epidemic on the economy, it has brought negative impacts on investment, consumption and import and export. At the same time, this year is the last year of the realization of a well-off society in an all-round way. In this context, a larger fiscal stimulus must be implemented to hedge losses in each of these areas. Therefore, the scale of the special government bonds this time will be relatively large, exceeding the previous two scales or reaching 4 trillion yuan.
At the same time, Feng Lin said that special government bonds can play an active role in the following aspects: First, through transfer payments, interest subsidies, and subsidies, etc., it can provide targeted support to areas affected by the epidemic, SMEs and low-income groups. This is mainly to support consumption and stabilize employment; the second is to invest in infrastructure and promote the construction of central infrastructure projects, which can speed up the funding source for infrastructure investment this year; the third is to allow commercial banks to pay deposit reserves with such special government bonds , It can increase the bank's loanable funds and guide banks to increase credit support to the real economy, especially small and medium-sized enterprises. (Securities Daily)