October ushered in the peak of special bond issuance, and the balance limit of more than 500 billion yuan "opened"——
Steady investment, local special bonds make another effort
Since the beginning of this year, China's economy has been hit by unexpected factors, and local government special bonds have played an important role in driving the expansion of effective investment and stabilizing the macro economy.
According to the deployment of the State Council, all localities will revitalize the limit of more than 500 billion yuan of special bonds accumulated since 2019 according to law, and issue them before the end of October.
What areas and projects will the funds go to?
Drive the expansion of effective investment
——Special bond funds are mainly invested in nine fields such as transportation infrastructure, energy, agriculture, forestry and water conservancy; new infrastructure and new energy projects are included in the scope of key support
It is understood that special bonds were issued for the first time in 2015, with a scale of 100 billion yuan issued that year; more than 1 trillion yuan in 2018; and 3.75 trillion yuan in 2020.
Special bonds have become an important policy tool for stabilizing investment and growth.
Since the beginning of this year, the issuance and use of local special bonds has been accelerating. As of the end of August, a total of 3.52 trillion yuan has been issued, and the quota for project construction has basically been issued, which is much earlier than in previous years.
"This year's special-purpose debt is ahead of schedule, and the progress is at least 3 months earlier than in previous years, which not only strongly supports the macro economy, but also wins a time window for strengthening counter-cyclical adjustment in the second half of the year and launching the special debt incremental policy." Professor of the University of Chinese Academy of Social Sciences Ji Fuxing said.
To give full play to the role of special debt in stabilizing investment, continuous efforts are needed.
The revitalization of the special debt balance limit in accordance with the law can effectively make up for the lack of social demand.
At present, the balance limit of more than 500 billion yuan being issued has attracted the attention of all parties.
What is the special bond balance limit?
Assistant Minister of Finance Owen Han explained that the balance of local government debt is subject to limit management, and the total limit of local government debt is determined by the State Council according to the country's macroeconomic situation and other factors, and reported to the National People's Congress for approval.
The special debt balance limit refers to the part of the special debt balance that is less than the limit, which is mainly the corresponding limit space formed by strengthening the management of fiscal revenue and expenditure, arranging fiscal funds to repay the due special bonds, and reducing the special debt balance in order to control the level of debt risk.
"The special bond balance limit policy can fill the 'empty window period' of special bond development after September, which will help to form a rolling investment in the second half of the year." Ji Fuxing said.
Which areas and projects will the new special bonds generated by revitalizing the balance limit be invested in?
According to Owenhan, the local balance limit of more than 500 billion yuan of special bonds will be invested in nine major areas, including: transportation infrastructure, energy, agriculture, forestry and water conservancy, ecological and environmental protection, social undertakings, urban and rural cold chain and other logistics infrastructure, municipal and industrial park infrastructure , National major strategic projects and affordable housing projects, etc.
At the same time, more projects will be included in the scope of key support.
Long Xiaoyan, an associate researcher at the Chinese Academy of Fiscal Sciences, told reporters that, according to policy arrangements, in addition to the original nine major areas, special bonds can also support the construction of new infrastructure, new energy and other projects that have increased stamina and high-level projects; support urban management Network construction and other projects that benefit people's livelihood and relieve people's worries; support the construction of projects that make up for shortcomings, strengths and weaknesses, such as agricultural and rural modernization, grain storage and logistics facilities to ensure grain supply.
As the balance limit of more than 500 billion yuan is "opened", the special debt funds will leverage social funds through the multiplier effect, and play the leverage role of "four or two thousand pounds".
Some experts estimate that more than 500 billion yuan of incremental funds will provide about 3.8 percentage points of support for the completion of the annual local government fund budget expenditure; according to the proportion of 40% invested in infrastructure, it is expected to boost the growth rate of infrastructure investment throughout the year by 1.1 percentage points. percentage point.
Accelerate the revitalization of the reserved quota
——70% of the special bond balance limit will be reserved for local governments, and 30% will be allocated by the central government and will be allocated to areas with more mature projects; October will usher in the peak of local special bond issuance
The journey from Ningbo to Jinhua is shortened to 89 minutes, and it is expected to be completed and opened to traffic by the end of 2023. Recently, the first frame pier steel beam on the entire Yongjin Railway has been accurately hoisted in place, and the project construction is progressing smoothly.
In Ningbo, Zhejiang, the construction of a modern transportation system integrating trunk airports, high-speed railways, intercity railways, expressways, and urban rail transit is accelerating, which is inseparable from the leveraging of special debt funds.
Issued special bonds of 1 billion yuan to support the construction of the Ningbo-Jinan Railway, and 2.9 billion yuan to support the construction of the second phase of the Hangzhou-Ningbo Expressway double-track project... In the first half of this year, a total of 22.7 billion yuan of special bonds were issued in the field of transportation infrastructure in Ningbo, serving 33 transportation infrastructures in the city. Facility projects provide strong support.
Across the country, many high-quality projects are awaiting the timely release of special debt funds.
Yang Yinkai, deputy secretary-general of the National Development and Reform Commission, said that the National Development and Reform Commission has organized local submissions and screening to form a new batch of preparation projects for this year, plus the projects that have not yet been arranged in the preliminary preparation project list this year. Issuance demand of more than 500 billion yuan of special bond balance limit stock.
At present, many places have disclosed plans for the next round of special bond issuance.
Liaoning is one of the first provinces to use the balance limit to issue special bonds this year, and issued 6.7 billion yuan of new special bonds on September 27.
Tianjin issued 1.289 billion yuan of new special bonds on September 28.
Guizhou, Jilin, Shaanxi, Shandong, Chongqing and other places also announced government bond issuance plans for September, October and the fourth quarter.
How to allocate the balance limit of more than 500 billion yuan of special bonds?
The executive meeting of the State Council made it clear that 70% will be retained by local governments, and 30% will be allocated by the central government and will be allocated to areas with more mature projects.
Bai Yanfeng, Dean of the School of Finance and Taxation, Central University of Finance and Economics, analyzed that this is mainly because of the different economic and social development conditions in different places. Reasons such as insufficient project reserves are prone to 'money and other projects'."
According to incomplete statistics, as of the end of September, the balance limit of over 400 billion yuan had been clearly allocated, and most of them were issued in October; among them, Hebei, Shandong, Fujian, Sichuan, Henan, Yunnan and other provinces had more quotas, all of which were 30 billion yuan. above.
"The allocation of special debt quotas this time is tilted towards areas with many mature projects, which will help large economic provinces to shoulder heavy burdens and strive for the best results of economic and social development throughout the year, taking into account the fairness and efficiency between regions." Bai Yanfeng said.
Industry insiders predict that with the centralized issuance of special bond balances, October will usher in a peak of local special bond issuance across the country.
According to Yang Yinkai, the National Development and Reform Commission will, in accordance with the requirement of "funds follow the project", promote the formation of physical workload as soon as possible with special debt funds.
At the same time, urge all localities to speed up the approval procedures for project land use, environmental impact assessment, construction permits, etc. in compliance with laws and regulations, and speed up the implementation of construction conditions such as land acquisition and demolition, and municipal facilities.
Make good use of funds
——The use of special bond funds is resolute not to sprinkle "pepper noodles"; funds are mainly invested in projects under construction and projects that can be started as soon as possible, so as to form a physical workload as soon as possible
In the face of the upcoming peak issuance, how to make good use of the special bond funds?
The Ministry of Finance requires that all localities should prioritize the use of special bond funds for key projects included in the national "14th Five-Year Plan" outline and major regional development strategies, and resolutely do not sprinkle "pepper noodles".
Deepening and solid project reserves is the premise of making good use of special debt funds.
In Hebei Province, the reserve work for special bond projects in 2022 was "head-to-head" in August last year. This year, a normalized rolling reserve mechanism was established, and 50 special bond project review specifications, 60 questions on the whole process policy guidelines and project points were specially compiled. There are 70 typical cases in the field, and guide cities and counties to further strengthen project planning and reserve. The number of reserve projects has reached more than 1,440 and the amount is more than 164 billion yuan.
Judging from the issuance plans of several provinces, the newly-added special bond funds issued by making good use of the balance limit are mainly invested in projects under construction and projects that can be started as soon as possible, so as to form a physical workload as soon as possible.
Looking at the direction of capital investment, Liaoning's 6.7 billion yuan of special debt funds will be invested in infrastructure and shantytown reform.
Shanghai issued 14.05 billion yuan of special bonds on September 20, including 8.7 billion yuan of special bonds for shantytown reform.
Sichuan will speed up the issuance and use of 35.6 billion yuan of new special bonds. Previously, the province has basically used up 188.2 billion yuan of new special bond funds by the end of August, which will be used for 1,896 major projects such as the Chengda-Wan Railway and Xiangjiaba Irrigation District. It is expected to drive more than 500 billion yuan of effective investment.
On the basis of the 164 billion yuan new government debt limit that Fujian has issued this year, it has once again obtained an additional special bond issuance quota of 35.9 billion yuan to support the construction of projects to promote investment and make up for shortcomings.
The Finance and Economics Committee of the People's Congress of Guangxi Zhuang Autonomous Region has clarified that the balance of 12.7 billion yuan obtained by Guangxi will be used to issue new special bonds to support the construction of major local projects.
According to industry analysts, October is a good "window period" for the centralized issuance of special bond balance limits.
From the perspective of issuance cost, the current interest rate for local bond issuance is relatively low, which will help reduce the burden on local governments.
At the same time, the market liquidity remained reasonably sufficient, and the liquidity disturbance caused by the centralized issuance of the balance limit was generally controllable.
"At present, special bonds have quota space, corresponding project reserves, and implementation conditions and time. They can continue to play a key role in stimulating effective investment and benefiting people's livelihood." Ji Fuxing said.
In the future, more key projects will be supported by special debt funds.
Owenhan said that the Ministry of Finance will actively study and appropriately expand the investment fields of special bond funds and expand the scope of special bonds used as project capital, so as to better play the role of special bonds in stimulating effective investment.
Experts predict that under the background of stabilizing economic policies such as revitalizing the quota space for local special debts in accordance with the law, infrastructure investment is expected to maintain rapid growth in the fourth quarter.
"Special bonds should focus on forming a combination effect with other continuous policies, focusing on forming policy synergy with policy development financial tools, policy credit, commercial credit, etc., so as to better play the comprehensive effect of expanding investment, bringing employment, and promoting consumption." Ji Fu said the star.
Our reporter Wang Wenzheng (Source: People's Daily Overseas Edition)