The Beijing municipal government is experimenting with a program to repay its special-purpose bonds early to save on interest charges, reports Nikkei Asia. The city government said that it has saved more than 70% on interest costs through early repayment of special-purpose bonds in 2023, according to a draft budget.
In August, Beijing repaid RMB 39 million ($5.5 million) of principal on an RMB 8.4 billion ($1.18 billion) 20-year special-purpose bond originally due in February 2040, nearly 17 years before its maturity date, according to the finance bureau.
The funds raised from the bond were invested in highways, transportation facilities and municipal facilities. About RMB 700 million was used for a cultural industry park in the eastern district of Beijing, according to the finance bureau.