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In order to deal with this problem, Beijing is proposing to allow a limited number of local authorities to issue bonds directly for the first time since 1994. This is a significant development and a welcome one. It should oblige local governments to be more transparent about their finances.nike shoes cheap Hopefully, this will in turn lead to a more disciplined approach to borrowing money. Greater disclosure will allow investors to differentiate between those municipalities which run a tight ship and those that are profligate. This should encourage them to cut borrowings and make better use of the funds which they receive.
　Given the seriousness of the problem, the Chinese government should perhaps worry about whether anyone will buy municipal bonds. Over the summer, the Ministry of Finance, has struggled to sell bonds on behalf of local authorities. Unless fiscal discipline is restored, direct sales of municipal paper will be no easier.