China's Strategic Reform: Oversight of Government Debt

China plans to tighten supervision of government debt by amending relevant laws. The National People's Congress (NPC) aims to require annual reports from the cabinet and local governments on debt management. The changes will be discussed in early November, with new debt issuance expected soon.

In a move to enhance transparency and oversight, China's National People's Congress (NPC) is set to amend legislation to enforce stricter supervision over government debt, a spokesperson announced Friday.

The proposed changes, spearheaded by the NPC's standing committee, will mandate annual progress reports on debt management from both the national cabinet and local governments, according to the spokesperson, Huang Haihua.

These draft amendments, expected to be reviewed from November 4 to 8, aim to broaden the oversight authority of the standing committee over fiscal and economic activities. This initiative aligns with Finance Minister Lan Foan's previous announcement of a significant increase in government debt to support economic recovery, although further details are awaited.

Additionally, as reported by Reuters, more than 10 trillion yuan in new debt issuance is anticipated, aimed at resolving local debt issues and revitalizing the real estate sector. Decisions regarding this financial strategy, with significant implications for both the property market and idle land, are expected soon.

(With inputs from agencies.)