Bond Stimulus Halted

Caixin: China's Stimulus Bond Program Faces Effectiveness Test
China's top economic planner appears to have temporarily halted a program that has channeled nearly 2 trillion yuan to government-backed infrastructure projects amid concerns that banks have shown little interest in participating.

...The government has wanted more investors to chip in, by purchasing the bonds or making loans directly to projects funded by the program, according to the bank executive. Lending from other investors is important because investment from the bond program often accounts for only 10 to 15 percent of the capital a project needs, he said.

But the response from many banks has been disappointing. One reason is that the bond fund usually supports projects conducted by the financing platforms owned by low-level authorities, such as county governments, to which big banks are often reluctant to make loans, according to several bank employees who have worked on related projects.

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