. Earth Science News .

China mulls extending local govt loans: report
by Staff Writers
Shanghai (AFP) Feb 14, 2012

China is considering allowing banks to roll over loans to local governments, giving them more time to repay massive debts from stimulus spending for the 2008 financial crisis, state media said Tuesday.

Local governments cannot borrow directly from banks, but in recent years they have set up financing vehicles to fund infrastructure and other projects, fuelling concerns about a potential explosion in bad loans.

The China Daily said the banking regulator was mulling "long-term" extensions of loans to local governments, and that a concrete policy could emerge as early as this month.

The China Banking Regulatory Commission could not be reached for comment Tuesday, but the Financial Times newspaper reported Monday that the central government had already ordered banks to roll over the loans to avoid defaults.

Last year, China's National Audit Office put the debt held by local governments at 10.7 trillion yuan ($1.7 trillion) at the end of 2010 -- or about 27 percent of China's 2010 gross domestic product (GDP).

Nearly half, or 4.46 trillion yuan, is scheduled for repayment this year, the China Daily said.

According to a separate report, China's banks had more than 9.0 trillion yuan of outstanding loans issued to local governments as of September last year, the Shanghai Securities News said Tuesday.

Analysts said China had previously rolled over such loans, but that the huge amount of money involved this time around was unsettling investors.

"Of course the loans are and will be rolled over," said Wang Tao, a Hong Kong-based economist for UBS.

"What is new and uncomfortable for investors is perhaps the size of new local debt accumulated during the last round of economic stimulus," she said in a research report on Tuesday.

The risk was some local governments used bank lending to finance unviable projects, which could eventually produce bad loans, Wang said.

China last year gave permission to four of its most developed cities and provinces to directly issue bonds, ending a long ban, to give cash-strapped local governments an alternative funding channel.

Related Links
The Economy

Get Our Free Newsletters Via Email
Buy Advertising Editorial Enquiries

Taiwan's U-Ming Marine to buy up to 10 China ships
Taipei (AFP) Feb 14, 2012 - Taiwan's U-Ming Marine Transport will buy up to ten freighters from a Chinese shipbuilder, in one of the single biggest boat orders the island has ever placed in mainland China, the company said Tuesday.

Under the contract signed Monday, China's Shanghai Waigaoqiao Shipbuilding Co. will build at least four 186,300-tonne bulk carriers for U-Ming Marine, with delivery scheduled for 2014, the Taiwanese firm said in a statement.

U-Ming, which is owned by Far Eastern Group, one of Taiwan's biggest conglomerates, also has an option to buy six more vessels of the same type, according to the contract, which is worth up to $500 million, it said.

U-Ming said modest expectations for the shipping industry in 2012 had allowed it to buy the vessels at "very competitive prices".

China claims sovereignty over Taiwan, but the island has ruled itself for more than six decades since a split in 1949 at the end of a civil war.

Ties between the two former bitter rivals have improved after Ma Ying-jeou of the China-friendly Kuomintang party came to power in 2008.


. Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle

Outside View: New economic optimism
College Park, Md. (UPI) Feb 14, 2012
Optimism is afoot that U.S. economic activity and jobs creation are picking up from the anemic pace that so far has characterized the economic recovery. Reports about innovative manufacturing and firms bringing production jobs back to America, the boom in onshore oil and natural gas development, stronger auto sales and profits and rising stock prices are lifting assessments for 2012. ... read more

Fukushima faces increased quake risk - study

Japan's Fukushima reactor may be reheating: operator

Top US general meets Egypt's Tantawi amid NGOs row

Bird numbers drop around Fukushima

Firm in Apple dispute seeks to ban China iPad imports

Apple shares surge despite factory inspections in China

US, EU approve Google purchase of Motorola Mobility

Iceland promotes clean-energy data centers

Reform of EU fishing quotas urged

Engage China in water dialogue: Experts

Ocean microbe communities changing, but long-term environmental impact is unclear

Ocean warming causes elephant seals to dive deeper

Despite Nobel tiff, Oslo backs China Arctic Council entry

NASA Mission Takes Stock of Earth's Melting Land Ice

CU-Boulder study shows global glaciers, ice caps, shedding billions of tons of mass annually

Putin receives 'prehistoric' water from Antarctic lake

Hatchery fish mask the decline of wild salmon populations

Bio-Disinfection With Semi-Composted Manure

Integrated weed management best response to herbicide resistance

5-10 percent corn yield jump using erosion-slowing cover crops

One dead as Cyclone Giovanna rips through Madagascar

3D laser map shows earthquake before and after

Tree rings may underestimate climate response to volcanic eruptions

Chile to prosecute workers over lack of tsunami warning

Sudanese air strike hits S Sudan, breaking pact: army

Nigeria army kills 12 suspected Islamists in flashpoint city

Inter-ethnic fighting displaces 40,000 in Kenya

Mali army tries to fend off Tuareg rebels as crisis grows

Neanderthal demise due to many influences, including cultural changes

Why the brain is more reluctant to function as we age

Cutting-edge MRI techniques for studying communication within the brain

Entire genome of extinct human decoded from fossil

Memory Foam Mattress Review

Newsletters :: SpaceDaily Express :: SpaceWar Express :: TerraDaily Express :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News


The content herein, unless otherwise known to be public domain, are Copyright 1995-2012 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement