On May 14, china.com.cn (reporter Li Chunhui), the Ministry of Finance announced the arrangement for the issuance of 2024 general treasury bonds and ultra long term special treasury bonds on the 13th, and the "schedule" for the issuance of ultra long term special treasury bonds, which attracted much attention, was clarified. Analysts said that the super long term special national debt can not only stimulate current investment and consumption, but also build a solid foundation for long-term high-quality development, with multiple benefits.
Image source: website of Ministry of Finance
The issuing rhythm is relatively gentle
Since the government work report in March proposed that "from this year on, it is planned to issue ultra long term special treasury bonds for several consecutive years, specifically for the implementation of major national strategies and security capacity building in key areas, and this year will issue 1 trillion yuan first", the market has been paying close attention to relevant arrangements.
"Special national debt" usually has two meanings: first, it refers to the national debt with a specific purpose for which the funds are invested. Second, unlike ordinary national debt, it is included in the budget of central government funds, and the approval mechanism and process of issuance are also flexible. "Ultra long term" means that the issuance period is longer than that of ordinary long-term bonds (usually 10 years or more).
China has issued five special treasury bonds, but only the 30-year special treasury bonds issued in 1998 and the 15-year special treasury bonds issued in 2007 can be classified as ultra long term special treasury bonds.
According to the notice issued this time, this year's ultra long term special treasury bonds include 20-year, 30-year and 50-year maturities, which will be issued for 22 times from May 17 to mid November.
"From the perspective of the number of issuance, it is mainly 30 years, which is in line with the market expectations." Feng Lin, director of the research and development department of Oriental Jincheng, analyzed that the issuance cycle of this year's 1 trillion yuan special national debt is longer than the market expectations, the issuance rhythm is relatively slow, and probably presents "small amount frequent issuance", so as to avoid periodic pressure on the capital surface due to collective issuance.
It benefits both the present and the future
The super long term special national debt is an important measure to moderately strengthen the fiscal policy, which is of great significance to stabilize expectations, stimulate domestic demand and boost the economy.
Lian Ping, president and chief economist of Guangkai Chief Industrial Research Institute, said that the ultra long term special national debt gives consideration to both the short term and the long term, which can not only stimulate current investment and consumption, but also build a solid foundation for long-term high-quality development, while helping local finance recuperate and bring benefits in many ways.
According to the deployment of the government work report, the ultra long term special national debt will be used for the implementation of major national strategies and the construction of security capacity in key areas. "It involves scientific and technological innovation, integrated urban and rural development, coordinated regional development, food and energy security, high-quality population development and other fields, and is closely related to China's economic transformation and upgrading and high-quality development." Lian Ping said. Such projects often have large investment and long return period, and it is difficult to fully meet the demand only by existing funding channels, so the central government needs to increase support. Ultra long term special treasury bonds can better match the financing needs of these long-term projects, which is conducive to long-term high-quality development.
In addition, the government work report made it clear that extra long term special treasury bonds would be issued "for several consecutive years", which released an important signal of sustained efforts and steady growth, and played a positive role in stabilizing social expectations.
Lian Ping predicted that the "consecutive years" are likely to be 4-5 years, from 2024-2025 at the end of the 14th Five Year Plan to 2027 or 2028 at the middle of the 15th Five Year Plan. If 1 trillion yuan is arranged every year, the final total issuance scale may be as high as 4-5 trillion yuan, which will far exceed the previous issuance scale of special national debt of 270 billion - 1.55 trillion yuan.
(Editor in charge: Tan Mengtong)