On January 8, the first batch of treasury bonds in 2025 will be tendered and issued; on January 13, the first local government bonds in 2025 will be issued. Experts believe that under the requirement of "more active" fiscal policy, the issuance of national debt and local debt will be moderately advanced. At the same time, relevant departments will arrange the use of funds as early as possible to ensure that capital projects "go in both directions" and form a strong boost to economic growth.
Treasury bonds take the lead in issuance
After the first-quarter treasury bond issuance plan was announced, the 2025 treasury bond issuance work was officially launched.
On January 8, three short-term treasury bonds were issued through bidding, with a total scale of 135 billion yuan. This is the first batch of treasury bonds issued in 2025. There are two key-term treasury bonds to be issued this week: On January 10, the Ministry of Finance will tender for the issuance of 2-year and 7-year treasury bonds, with scales of 117 billion yuan and 98 billion yuan respectively.
According to the issuance plan, the Ministry of Finance plans to issue 18 key-term treasury bonds, 18 short-term treasury bonds, 4 ultra-long-term special treasury bonds and 2 savings bonds in the first quarter. Qi Sheng, chief fixed income analyst at Orient Securities, said that compared with the government bond issuance plan in the first quarter of 2024, the maturity distribution of the government bonds planned to be issued in the first quarter of 2025 is basically the same, and one more short-term government bond is planned to be issued in quantity. From the perspective of issuance rhythm, the supply of government bonds in the first quarter was more evenly distributed in each month. Six key-term government bonds and short-term government bonds were issued from January to March. Two ultra-long-term general government bonds were issued in February. 1 piece issued.
"Historically, the issuance scale of treasury bonds in the first quarter has generally matched the maturity scale. However, it has been announced that the issuance scale of the 2-year and 7-year treasury bonds to be issued is 117 billion yuan and 98 billion yuan, respectively, compared with the same amount issued in December 2024. The scale of maturity varieties has increased and is higher than expected. "Li Yishuang, chief analyst of fixed income at Cinda Securities, said that the average issuance scale of key maturity interest-bearing government bonds in January is expected to be 105 billion yuan. According to this calculation, the net financing scale of government bonds in January was approximately 250 billion yuan, which was at a relatively high level for the same period in history.
As an important tool for implementing proactive fiscal policies, the issuance of 2025 ultra-long-term special government bonds was launched in January. Experts predict that the issuance scale of ultra-long-term special government bonds throughout the year will increase compared with last year to better exert its effect on stabilizing growth.
Local debt is gaining momentum
On January 6, Qingdao issued an announcement that it plans to tender and issue 3.917 billion yuan of special refinancing bonds on January 13. The funds raised will be used to replace existing implicit debts. This will be the first local government bond issued this year.
Enterprise warning data show that as of January 7, 16 provinces and cities under separate state planning have disclosed local government bond issuance plans for the first quarter of 2025, with a total scale of 857.969 billion yuan, of which 54.089 billion yuan will be added in general bonds and 54.089 billion yuan will be refinancing. 150.218 billion yuan of bonds, 250 billion yuan of new special bonds, and 403.662 billion yuan of refinancing special bonds. In terms of issuance time, Sichuan, Shandong, Hunan, Hainan and other places plan to launch local bond issuance in January.
Experts predict that local government bonds will be issued earlier in 2025. On the one hand, the issuance of special refinancing bonds used to replace existing implicit debts is expected to accelerate. "Considering that the 6 trillion yuan bond quota has been uniformly issued, it is expected that the issuance of special refinancing bonds in 2025 may maintain a relatively fast pace and may be completed in the first half of the year." Liu Yu, chief economist of West China Securities, said.
On the other hand, under the guidance of policies, the issuance and use of new special bonds will be accelerated. The National Financial Work Conference held recently proposed increasing expenditure intensity and accelerating expenditure progress. The "Opinions on Optimizing and Improving the Management Mechanism of Local Government Special Bonds" recently issued by the General Office of the State Council clearly states that "negative list" management of special bond investment areas will be implemented, "self-examination and spontaneous" pilot projects of special bond projects will be carried out, and special projects under construction will be opened up for renewal. Bond "green channel".
Gao Ruidong, chief economist of Everbright Securities, said that allowing pilot provinces and cities to self-examine special bonds simplifies the special bond approval process and will improve implementation efficiency; at the same time, the project review "green channel" mechanism means smooth project submission, which will reduce The review pressure brought by centralized declaration and smooth implementation of investment projects. Liu Yu said that the decentralization of approval powers and the establishment of a "negative list" for projects will "loosen" the review of special bonds and facilitate the acceleration of the issuance of special bonds.
Accelerate the formation of physical workload
While government bonds are being issued as early as possible, relevant departments will deploy project reserves and fund utilization in advance to ensure a strong stimulus to economic growth.
Ultra-long-term special treasury bonds will continue to support the implementation of “two major” projects and “two new” policies. In order to increase support for the "two new" projects, Yuan Da, deputy secretary-general of the National Development and Reform Commission, said that the scale of ultra-long-term special treasury bonds will be significantly increased in 2025 and the implementation of the "two new projects" will be expanded. Optimize the allocation of funds for the trade-in of consumer goods, tilting it towards areas with better results last year; reduce corporate advances and operating pressures, simplify the subsidy process, and cash in subsidy funds in a timely and efficient manner; standardize market order, strengthen project fund supervision, etc., and continue to improve policy effects.
CICC predicts that every additional RMB 100 billion of special treasury bond funds in 2025 to support the replacement of old products with new ones is expected to boost the growth rate of total retail sales of consumer goods by 0.6 percentage points.
In terms of supporting the "dual emphasis", Yuan Da revealed that on the basis of the project list of approximately 100 billion yuan for 2025 issued in advance in 2024, another batch of project lists will be issued in the near future to promote the formation of physical workload as soon as possible.
In order to ensure that the new special bonds are implemented into projects as soon as possible, local governments are also actively preparing. The main person in charge of the Henan Provincial Department of Finance stated that we insist on early arrangements and deployments, organize all levels to prepare project reserves in advance, and scientifically and efficiently complete the allocation, approval, and release of new government debt limits.
Sufficient project reserves and strong funding support will help continue to expand effective investment and promote high-quality economic development. "The growth rate of fixed asset investment is expected to rise steadily in 2025, slightly accelerating from 2024, and the driving force of investment for economic growth will be enhanced." said Wang Qing, chief macro analyst of Oriental Jincheng.
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