This year, China’s local government financing vehicles will have to face a record repayment amount in the midst of an ongoing economic slowdown.
China’s local government financing vehicles (LGFV) need to pay back 4.65 trillion yuan ($650 billion) in 2024, according to data compiled by Bloomberg. This marks a 13 percent year-on-year increase to an all-time record.
LGFVs are companies that are used to borrow on behalf of Chinese provinces and cities, mainly to finance infrastructure projects.
The record amount due comes amid an ongoing economic slowdown in China, which has been hit by various headwinds including troubles from its property sector. According to the International Monetary Fund, China is forecasted to grow 5.4 percent in 2023 and 4.6 percent in 2024.
