NDRC specifies local governments' investments and financing platforms requirements

09:03, December 01, 2010      

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The National Development and Reform Commission (NDRC) recently issued a document to further specify the requirements to local governments' investments and financing platforms' issuing of securities, according to a caing.com report Tuesday.

According to the new rule, for more than 30 percent of the investments and financing platforms,
when issuing securities, apart from the already-demanded-by-law requirements, they will also have to provide a complete dossier of the local governments to the authorities for reference.

To avoid risks and increasing local governments' debts, all platforms that apply to issue securities are required to have 70 percent or more of the sinking fund from its revenues.

Also, if their debt ratio where the investments and financing platforms lay exceed 100 percent, the applications to issue securities will not be approved.

Meanwhile, the platforms that apply to issue securities will be banned to inject public assets: public schools, hospitals and parks into their own.

The projects that issue securities to use the money in energy saving, carbon emission, environmental protection; affordable housing construction, urban transportation, development and constructions in the Xinjiang Uygur Autonomous Region and Tibet Autonomous Region; construction projects in disaster-hit areas will be given priority.

Local governments' investments and financing platform refers to the economic entity set up by them; departments or organizations, and they usually invest, finance, construct and operate some public projects.

Source: Global Times


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