Bonds News
- China approves record railway bond issue worth $6 billion
Date: 30-Nov-2007 Sources: (Xinhua Online)
BEIJING, Nov. 29 (Xinhua) -- The Ministry of Railways is issuing bonds worth 45 billion yuan (about 6 billion U.S. dollars), the largest single issue since China launched railway bonds in 1995, to bankroll 21 projects.
The issuance, approved by the National Development and Reform Commission, will last until Dec. 4. It included seven-year bonds totaling nine billion yuan, 10-year bonds amounting to 26 billion yuan and 15-year bonds worth 10 billion yuan.
With interests rates ranging from 5.38 percent to 5.75 percent, the issuance overshot the original target of 35 billion yuan (about 4.74 billion U.S. dollars) as a result of over-subscription.
The capital would be used to finance the purchase of railway locomotive and cars and 21 railway projects. They included the construction of a second rail line linking Hailar and Manzhouli, China's largest land port city on the Sino-Russian border where cargo traffic has shot up by 11.2 percent year-on-year between January and November to 22.03 million tons.
Other projects identified by the statement included the electrification of the Qinshihuang-Shenyang Railway in northeast China and the construction of a new passenger rail line between Zhengzhou of the central Henan Province and Xi'an of Shaanxi Province.
Upon completion of the issuance, the total railway bonds in China would amount to 113.7 billion yuan (about 15.4 billion U.S. dollars), the statement said.
The ministry hoped the issue would boost railway construction and give a spur to the country's burgeoning debt market. Earlier this month, work started on 16 new express passenger rail projects. By 2020, the country was expected to have 12,000 kilometers of express rail lines.
Corporate bonds in China totaled 450 billion yuan by August, much smaller than many of the world's developed countries, official figures revealed.
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