Rating local government debt is a provision of the "Opinions of the State Council on Strengthening the Management of Local Government Debt" issued on October 2, 2014 to implement scale control and budget management of local government debt. Its purpose is to improve local government bonds.

The market strictly limits local government borrowing procedures and fund uses.

(1) Implement scale control on local government debt.

The scale of local government debt is subject to limit management, and local government debt must not exceed the approved limit.

The scale of local government general debt and special debt is included in the limit management, which is determined by the State Council and submitted to the National People's Congress or its Standing Committee for approval. The regional limits are determined by the Ministry of Finance based on the debt risk of each region within the scale of local government debt approved by the National People's Congress or its Standing Committee.

, financial status and other factors are calculated and submitted to the State Council for approval.

(2) Strictly limit local government debt raising procedures and fund uses.

Local governments borrowing debt within the regional limits approved by the State Council must report to the people's congress at the same level or its standing committee for approval.

Local governments are not allowed to borrow debts through enterprises and institutions.

Local government borrowing must follow market-oriented principles.

Establish a local government credit rating system and gradually improve the local government bond market.

Debt borrowed by local governments can only be used for public welfare capital expenditures and appropriate repayment of existing debts, and cannot be used for current expenditures.

(3) Incorporate local government debt into full-scale budget management by category.

Local governments should incorporate general debt revenues and expenditures into general public budget management, incorporate special debt revenues and expenditures into government fund budget management, and incorporate fiscal subsidies and other expenditures in government-social capital cooperation projects into corresponding government budget management according to their nature.

All local government departments and units must incorporate debt revenue and expenditure into department and unit budget management.

If there are debts that require the local government or its departments or units to bear debt repayment responsibilities in accordance with the law, the debt repayment funds must be included in the corresponding budget management.