China’s eastern province of Zhejiang is set to sell 6.7 billion yuan worth of local government bonds today (Monday).

According to plan, 3.3 billion yuan of three year bonds and 3.4 billion yuan five year bonds will be auctioned. The bond sale comes after the city of Shanghai and southern province of Guangdong sold the country’s first local government bonds directly backed by local authorities.

A total of four local governments, Shanghai, Guangdong, Shenzhen and Zhejiang, have so far received approval to participate in the pilot scheme to sell bonds directly.

Experts say allowing local authorities sell debt directly into the market will help improve transparency in local government debt, as bond issuers are required to publish annual reports and stipulate clearer obligations than local government financing vehicles do. But experts also caution that direct issuance requires proper supervision.

Source:cntv.cn