Action on local government debt serves as demonstrative example
ANBOUND
After the announcement of Document No. 87, the punitive intensity of the Chinese local governments against debts has increased. Media has recently reported that in May this year, the Ministry of Finance has informed certain province on the issue illegal debt problem, which concerns a $ 110 million loan and repay in 2016; the development zone director was dismissed from office and was under the judiciary in accordance with the law, while a number of officials and local officials were punished and received administrative warning; the development zone management committee was also required to conduct a written inspection. Next, other regions and financial institutions suspected of illegal and other debt relief will be dealt with according to the law. Under this new situation, the action on the local governments would serve as an example for others on abiding the rules on debt and financing.