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China's local government debt seen at $3 trillion as of end 2012: think tank
December 23, 2013 / 5:16 AM / 4 years ago

China's local government debt seen at $3 trillion as of end 2012: think tank

BEIJING (Reuters) - China’s total local government debt may have reached 19.9 trillion yuan ($3.28 trillion) by the end of 2012, almost double that of two years previously, a media report said on Monday, citing a private study by a government think tank.

A bridge is in under construction in Leishan county, southeast Guizhou province November 23, 2012. REUTERS/Sheng Li

Local government debt in China has surged in recent years as credit flowed into the building of public infrastructure. Poor government disclosure on debt levels, however, has aggravated concerns about the true size of the debt.

China’s National Audit Office said in July it would conduct an audit of all government debt at the request of the cabinet, but the results have not yet been published.

Official figures showed local government debt stood at 10.7 trillion yuan by the end of 2010.

“We need to pay great attention to the debt level of local government,” the website of the Security Times newspaper quoted the study by the Chinese Academy of Social Sciences (CASS) as saying.

The study also said that the total debt of China’s central and local governments reached nearly 28 trillion yuan by the end of 2012, accounting for 53 percent of the country’s GDP.

Beijing has repeatedly played down concerns about local government debt levels, and insists systemic problems are unlikely.

Reporting By Xiaoyi Shao; Editing by Jacqueline Wong

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