穆迪关于中国地方ZF债务问题的最新报告，免费给大家！Chinese Regional & Local Governments Growing Use of Trust Products Could Challenge Credit Quality
Summary Opinion
» Regional and local governments (RLGs) in China have increased their use of government trust cooperation products (“trust products”) in 2012 to secure financing for capital projects. While the amounts are still small, we believe that a continued rise in the use of these products could negatively affect the credit quality of some RLGs.
» Chinese RLGs have resorted to these products to address their substantial infrastructure investment requirements, given that their direct access to financing is very limited and their own sources of funding have tightened.
» Trust products ultimately add to an RLG’s debt burden as they are contractual obligations that require a repayment or “returns on projects”. As such, they are akin to debt obligations. Trust products can also exert additional pressures on RLG budgets because of their high costs, which are related to their short tenors and higher coupon rates.
» Moreover, these transactions, which are not recorded as debt, add a further layer of complexity for determining an RLG’s debt levels, thereby potentially further blurring fiscal transparency.