China estimates direct govt debt at $3.4t

The National Audit Office (NAO) said Monday in a statement that governments at various levels in China were liable for a total direct debt of 20.7 trillion yuan ($3.4 trillion) as of the end of June 2013.

Total debt guaranteed by governments at various levels amounted to 2.93 trillion yuan at the end of June, the NAO said in the statement posted on its website.

Debt for which governments at various levels might shoulder some of the rescue burden amounted to 6.65 trillion yuan, data revealed.

The auditing results came after a two-month-long nationwide audit of government debt by the NAO in August and September of 2013.

In breakdown, the auditing results showed that direct debt owned by the Chinese central government stood at 9.81 trillion yuan at the end of June, while the remaining 10.89 trillion yuan was owned by local governments.

The debt guaranteed by the central government was at 260 billion yuan, while debt guaranteed by local governments totaled 2.67 trillion yuan, according to the results.

Over the past year or so, the market has been worried over the scale of local government debt, as there has been no official update on it since mid-2011, when the NAO put the nationwide figure at around 10.7 trillion yuan by end of 2010.

China's direct govt debt risks controllable

China disclosed its total government debt on Monday and said that debt risk was under control.

China's total public debt to GDP ratio is about 53.3 percent, with 31.5 percent of that attributed to local government debt and 21.8 percent down to the central government, said Lu Ting, chief China economist with Bank of America Merrill Lynch, in a research note. >>>