The Budgetary Work Committee of the Standing Committee of the National People's Congress (NPC) yesterday announced that from 2006, China will introduce a new national debt management system to control financial risk.
From 2006, the NPC Standing Committee will examine and approve the annual national debt balance, rather than the annual issued amount of national debt.
The resolution on the implementation of new national debt management system, made by the Budgetary Work Committee of the NPC Standing Committee, was ratified by the meeting of chairman and vice-chairpersons of the NPC Standing Committee on Friday.
The statistics released by the Budgetary Work Committee of the NPC Standing Committee showed that by the end of 2004, China's national debt balance reached 2.9631 trillion yuan (US$370.4 billion), including 2.8803 trillion yuan (US$360 billion) of domestic debt and 82.8 billion yuan (US$10.3 billion) of foreign debt. By the end of 2004, China's national debt burden rate was 21.6 percent, far lower than 60 percent, the EU designated and internationally accepted warning mark.
Since China restarted to issue national debts in 1981, China's top legislature has managed national debt by examining and approving the annual issued amount of national debt.
However, the annual issued amount of national debt could not comprehensively reflect the country's national debt scale and the variability of the national debt. The method was unfavorable for the stable development of national debt market and the national debt management, said an official with the Budgetary Work Committee of the NPC Standing Committee.
(Xinhua News Agency December 19, 2005)