The $9 trillion of Chinese local government bonds that helped drag the rest of the world out of the 2008 financial crisis are a growing risk this time around.
The bonds funded an economic boom in China more than a decade ago, as local authorities borrowed heavily to invest in everything from roads to subways. But one of China’s biggest state-run investors advised asset managers overseeing its money to sell some of the debt, Bloomberg News recently reported, intensifying pressure on the securities.
Read More : China’s Unclear Debt Market Faces Tightening Funding Situation