地方政府償還欠款計劃(dìfāng zhèngfǔ chánghuán qiànkuǎn jìhuà):Plan for local governments to repay debts

The National Development and Reform Commission, China's top economic planner, announced on Wednesday that it is considering the feasibility of a plan for local governments to repay their debts and exercise installments for overdue payments.

Then on Thursday, the NDRC issued a document on promoting the healthy development of private investment, which includes 26 specific policy measures in such fields as promoting investment growth and improving financial services.

According to the NDRC, local governments should seriously fulfill their commitments and abide by the contracts they sign with enterprises and investors. Any change to the content of a contract should be made in accordance with the laws and regulations.

Some local governments face a great debt challenge at present. Minister of Finance Lou Jiwei said recently the ministry is paying close attention to the expansion of local government debts.

Due to the global economic downturn private investment has declined sharply in recent months. The new repayment plan, which requires local authorities to give timetable for repaying their debt, aims to enhance supervision of government and ease local governments' debt risks. A recent survey found local debt reached 23 trillion yuan ($3.45 trillion). But in some places governments may have hidden debt as they have borrowed from enterprises or institutions to carry out public welfare undertakings or infrastructure projects. The repayment plan for the local government debt will increase confidence the government debt can be managed and so encourage more private investment in public projects.