Bonds could boost rural development

Beijing may issue new bonds to lenders linked to rural development projects in an effort to build up the countryside and remove some of the excess liquidity in the banking system. China needs to spend US$2.5 trillion by 2020 on rural infrastructure but banks are generally unwilling to fund these projects, which are generally seen as unprofitable, The Standard of Hong Kong reported. �Issuing special-purpose bonds can solve this problem,� said Tang Suangning, vice chairman of the China Banking Regulatory Commission. Rural areas are home to some 60% of the country's population. Despite the country's breakneck economic growth, the gap between rural and urban incomes continues to widen.