China’s top economic planning body signaled it would let local governments directly sell municipal bonds for the first time, Reuters reported, citing a Tuesday statement by the National Development and Reform Commission (NDRC) on its website. Chinese media previously reported that Beijing was set to allow direct bond sales for ten governments including Beijing, Shanghai, Shenzhen and Guangdong. The NDRC statement did not refer to these plans, but said China will create a financing system for local governments that will let the sale of municipal bonds be a major source of funding. Opaque financing vehicles will also be phased out.
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