7月30日召开的中共中央政治局会议提到，要积极稳妥化解地方政府债务风险，严禁新增隐性债务，有力有序有效推进地方融资平台出清。 从年初的《政府工作报告》提出"加快剥离地方融资平台政府融资功能，推动市场化转型和债务风险化解"，到此次中共中央政治局会议的表述，政府对地方 融资平台的要求更为严格，显示出不断增强的政策决心。 2010年，国务院发布《关于加强地方政府融资平台公司管理有关问题的通知》，开始全面清理规范地方融资平台。2014年，国务院在《关于加强地方政府性 债务管理的意见》中明确要求，剥离融资平台政府融资职能，严禁其新增政府债务。2021年，国务院在《关于进一步深化预算管理制度改革的意见》中进一 步提出，清理规范地方融资平台公司，剥离其政府融资职能，对失去清偿能力的要依法实施破产重整或清算。 今年3月的《政府工作报告》提到，加快剥离地方融资平台政府融资功能，推动市场化转型和债务风险化解。7月30日召开的中共中央政治局会议提出，要积 极稳妥化解地方政府债务风险，严禁新增隐性债务，有力有序有效推进地方融资平台出清。 不过该负责人说："这种'借新还旧'的操作存在限制，要求融资平台的债务必须是银行信贷，而不是非标融 ...

Summary of the Conference Call on China's Debt Swap Program Industry Overview - The focus is on the **local government financing vehicle (LGFV)** debt risk in China, which has been a persistent issue due to mismatches between local government revenues and spending responsibilities [6][10][12]. Key Points and Arguments 1. **Debt Swap Program Progress**: - The Chinese government net issued **RMB 7.7 trillion** in bonds in H1 2025, more than doubling the **RMB 3.3 trillion** issuance in H1 2024, driven by the **RMB 10 trillion** debt swap program initiated in November 2023 [9][16]. - The debt resolution plan requires local governments to prioritize LGFV debt reduction and restrict new borrowing, leading to a significant slowdown in LGFV interest-bearing debt growth from **18.6%** year-over-year in 2020 to **4.6%** in 2024 [6][20]. 2. **Fiscal Spending and Cash Flow**: - Fiscal spending disruptions eased, and LGFV operating cash flows turned positive due to the debt swap plan, despite a **12%** year-over-year decline in land sales revenue [6][34]. - Local governments have utilized about **82%** of the **RMB 2.8 trillion** full-year quota for debt swaps in H1 2025 [16]. 3. **Challenges in Debt Management**: - Annual interest payments on LGFV debts remain high at **2.3%** of GDP, with over half of provinces facing interest payments exceeding **10%** of their expenditures [7][54]. - The debt service burden is still significant, with the overall local government debt-to-GDP ratio climbing from **57%** in 2019 to **81%** in 2024 [23]. 4. **Economic Impact and Future Outlook**: - The debt swap program is expected to provide a **50 basis points** potential GDP boost in 2025, but actual allocation favored high-risk regions less than anticipated, receiving only **35%** of the quota [42]. - Continued efforts to control debt growth and reduce financing costs are necessary to stabilize and potentially lower debt service costs, which is crucial for avoiding aggressive revenue collections and public sector salary cuts [56]. 5. **Long-term Solutions**: - Long-term solutions involve reforms of LGFVs, including commercialization, and addressing fundamental mismatches between local government revenue sources and spending responsibilities [7][57][59]. Additional Important Content - The report highlights the increasing reliance of LGFVs on short-term debt financing, with a deteriorating interest coverage ratio and cash-to-short-term-debt ratio [11]. - The debt swap program includes **RMB 800 billion** of special-purpose new bonds annually from 2024 to 2028, and **RMB 2 trillion** of refinancing bonds per year from 2024 to 2026 [18]. - The report emphasizes the need for major fiscal and tax reforms to address the fundamental issues of local government indebtedness [59]. This summary encapsulates the critical insights from the conference call regarding the ongoing challenges and strategies related to China's local government debt management and the implications for economic stability.