While the statements of the finance minister speaking at the press conference held at the weekend in China were disappointing, exciting news came from the media. According to the news of Caixin, one of the important organisations of the Chinese media, the state plans to issue ‘ultra-long-term private treasury bonds’ and obtain 6 trillion yuan in 3 years.

Where will they be used?

According to the report, some of the funds will be spent on local governments to pay off their unrecorded debts. On Saturday, Finance Minister Lan Foan did not elaborate on the financial support package, but said that the proceeds would be used to pay off local governments’ debts, as well as to buy land and houses from struggling property companies. The minister did not specify a figure and did not give a timetable.

It is claimed that such unregistered debts, which have increased seriously especially during the pandemic period and the real estate crisis, are approaching $10 trillion (approximately 55 trillion yuan) in China. This situation creates a huge deficit and therefore a problem.

Households will also come

In the meeting held by the Central Bank of China in the past weeks, the financial incentive package was announced and it was stated that especially domestic consumption would be supported. This issue was also touched upon at Saturday’s meeting and it was stated that households will also be given significant assistance.

Such financial incentives can also bring rises in China-based stocks and cryptocurrencies. Especially after the central bank’s first press conference on September 24, there were serious rises in both stock markets and Bitcoin.