China LGFVs pass Latest test

摘要

A default scare in China's onshore debt markets has put the spotlight on the country's local government finances at a time when more financing vehicles are turning to the offshore markets to raise funds. Last week, news that yunnan state-owned capital operation (Yunnan Capital) failed to meet repayment obligations on time on two trust loans sparked a sell-off of some US dollar bonds of local government financing vehicles, especially those from Yunnan province.