NEARLY 65 percent of the new bonds issued this year by the Shenzhen Municipal Government, which are worth 31.4 billion yuan (US$4.46 billion), are to be used for water treatment, the Southern Metropolis Daily reported.

The water treatment projects concern key rivers like the Maozhou River and Longgang River. Besides rivers, the money will also be used for the construction of Mawan Cross-Sea Link (from Yueliangwan Boulevard to Yanjiang Highway), Metro Line 14, additions to the airport, renovations to urban villages in Futian, Luohu and Yantian, and public hospitals in Longhua, and land reserve projects in Pingshan and Guangming districts, according to the report.

The city plans to allocate nearly 50 billion yuan to water treatment projects this year. Last year, 39.2 billion yuan was invested on water treatment. The figure in 2017 was about 19 billion. Altogether, the city has spent over 100 billion yuan treating water pollution over the last three years.

Issuing bonds, as a result, will help provide the local government with enough working capital. Moreover, it enables the local government to independently attract investment in order to develop the city efficiently, the report said.

Municipal bonds are also more attractive to investors due to their security.

Shenzhen was selected by the Ministry of Finance as one of the 10 pilot cities eligible to independently issue and pay off local bonds in 2014. Since then, Shenzhen’s financial situation has continued to be good in terms of the bond scale.

Shenzhen’s debt ratio was 3.2 percent at the end of last year, which was far lower than Beijing at 54.5 percent, Shanghai at 54.7 percent and Guangzhou at 79.2 percent.

A sound financial condition is necessary for a city’s development. Shenzhen’s low debt ratio demonstrates its good financial condition, which is related to factors such as high fiscal revenue, optimized industrial structure and stable investment in infrastructure, according to the report.

(Wang Jingli)