In 2024, China has made significant strides in its financial strategy by issuing 1 trillion yuan (approximately US$138.12 billion) in ultra-long-term special government bonds. This initiative, which includes 22 discrete issuances since March 5, was announced by Premier Li Qiang as a means to bolster government funding. The bonds come with maturity terms of 20, 30, or even 50 years, offering yields ranging from 2.19% to 2.57%. This marks a notable return to a financing method not seen since previous issuances in 1998, 2007, and 2020. Of the total issuance, 700 billion yuan is allocated for major national strategies, such as the ambitious Shanghai–Chongqing–Chengdu high-speed railway project, while the remaining 300 billion yuan is designated for a trade-in program aimed at stimulating domestic demand.
These ultra-long bonds are designed to alleviate the debt pressures faced by local governments and to support broader economic growth in China. The issuance reflects a strategic pivot towards enhancing infrastructure and investment, with future issuances planned to fund additional strategic projects. This aligns with the government's ongoing efforts to stabilize the economy amid various challenges, including local government debt and the need for sustainable growth. The introduction of these bonds is seen as a proactive approach to managing fiscal responsibilities while simultaneously fostering economic development. [70171b65]