China has initiated the issuance of special treasury bonds with terms exceeding 30 years, marking a significant step toward optimizing its debt structure and supporting long-term economic growth.
The newly issued ultra-long-term bonds have maturities ranging from 10 to 50 years, with some reaching up to 50 years—a rarity in China’s bond market. Historically, treasury bonds with terms over 30 years have been uncommon, with the total outstanding balance of bonds exceeding 25 years amounting to less than 2 trillion yuan (approximately $277 billion).
China has previously issued special treasury bonds in 1998, 2007, and 2020, contributing to economic and social stability. However, this new batch stands out due to its significantly extended maturities.
Ultra-Long Terms to Enhance Stability
Long-term bonds are typically those with terms of 10 years or more. By issuing bonds with ultra-long terms, China aims to lock in low borrowing costs for an extended period, reduce refinancing pressure, and improve the maturity structure of government debt.
The move to issue longer-term bonds is expected to meet the funding needs of long-term projects and investments, supporting sustained economic development. It also reflects the government’s confidence in the long-term stability and growth of the Chinese economy.
This strategic adjustment in debt issuance comes as China continues to navigate complex domestic and international economic landscapes, seeking to balance short-term stimulus with long-term fiscal sustainability.
Reference(s):
cgtn.com
