Wang Tao, head of Asian economic research and chief economist at UBS, wrote that since the 2023 local government debt limit was allocated more than 2.2 trillion yuan to support localized debt and clear up arrears, and an amount of 1.2 trillion yuan was set in 2024, we expect that the amount of new chemical debt may exceed 3 trillion yuan by the end of 2025, and the scale of debt replacement may greatly exceed this scale in the next few years.

Wang Tao, head of Asian economic research and chief economist at UBS, wrote that since the 2023 local government debt limit was allocated more than 2.2 trillion yuan to support localized debt and clear up arrears, and an amount of 1.2 trillion yuan was set in 2024, we expect that the amount of new chemical debt may exceed 3 trillion yuan by the end of 2025, and the scale of debt replacement may greatly exceed this scale in the next few years.