There are differences between special bonds and local bonds in terms of issuance purpose, source of repayment, issuance scale, issuance period and bond nature.

1. The two issuance purposes are different: special bonds are bonds issued to support the construction of public welfare projects with certain returns, such as urban rail transit, toll roads, and water resources reserves.

Local bonds are bonds issued to make up for the usual public fiscal deficits and are used to protect and improve people's livelihood, promote economic and social development, and maintain national security.

2. The sources of repayment funds for the two are different: the repayment funds for special bonds come from government fund income or special income corresponding to public welfare projects, such as sewage fees, water resources fees, and education surcharges.

The repayment funds for local debts come from normal public budget revenues, such as taxes and transfer payments.

3. The issuance scale of the two is different: the issuance scale of special bonds is determined by the State Council based on project construction needs and reported to the National People's Congress or the Standing Committee of the National People's Congress for approval.

The issuance scale of local bonds is determined by the State Council based on the fiscal deficit situation and reported to the National People's Congress or the Standing Committee of the National People's Congress for approval.

4. The issuance period of the two is different: the issuance period of special bonds is generally between 5 and 20 years, determined according to the project construction cycle and income; while the issuance period of local bonds is generally between 1 and 10 years, according to the fiscal

Demand and market conditions are determined.

5. The two are essentially different: special bonds are interest rate bonds, that is, bonds that pay interest at fixed or floating interest rates, and their credit risks are low.

Local government bonds are credit bonds, that is, bonds with interest rates determined based on credit ratings, and their credit risks are relatively high.

Are the principals of local special bonds guaranteed?

Local special bonds are capital-guaranteed bonds with low credit risk and strong repayment guarantee. They are usually better than AAA corporate bonds.

In addition, local special bonds can be used as project capital, and the funds are synchronized with the project, which has a strong role in leveraging investment.

The issuance period is long and can match the construction cycle of infrastructure projects.