Judging from the issuance arrangements, the ultra-long-term special treasury bonds involve maturities of 20 years, 30 years, and 50 years. The earliest 30-year tranche will be launched this Friday (May 17).
What are ultra-long-term special government bonds?
The national debt we often mention mostly refers to savings bonds. What’s so special about ultra-long-term special Treasury bonds?
The first is the term. In the bond market, interest rate bonds with a bond issuance period of more than 10 years are generally considered "ultra-long-term bonds." The ultra-long-term special treasury bonds planned to be issued this year have three terms: 20 years, 30 years and 50 years. Variety.
"Special treasury bonds" refer to treasury bonds with special purposes issued during special periods. They are generally earmarked for special purposes, have flexible uses, and are not included in the fiscal deficit.
Bank of China Research Institute pointed out that its particularity is reflected in four aspects. In terms of issuance methods, China currently implements a key period regular issuance system for treasury bonds with a maturity of less than 10 years, while ultra-long-term treasury bonds are issued by the Ministry of Finance at its discretion based on economic and market conditions.
In terms of fund use, special treasury bonds have clear and specific uses, and their funds need to be earmarked for special purposes; while ordinary treasury bonds are mainly used to make up for fiscal deficits and supplement national fiscal funds.
In terms of fund budget management, special national debt is not included in the general public budget and is not included in the fiscal deficit, but it is still a government debt and needs to be included in the year-end national debt balance limit in accordance with the national debt balance management system.
In terms of the issuance process, the issuance of special treasury bonds only requires the State Council to submit it to the Standing Committee of the National People's Congress for review and approval, and the year-end treasury bond balance limit will be increased accordingly. The issuance process is simple, flexible and fast. The new limit for ordinary treasury bonds is generally proposed in the annual budget report to the National People's Congress, which is reviewed and approved by the National People's Congress, and the flexibility is relatively poor. Where does
go? Why post it?
This year's "Government Work Report" mentioned that in order to systematically solve the funding problems of some major projects in the process of building a strong country and national rejuvenation, it is planned to issue ultra-long-term special treasury bonds for several consecutive years starting from this year, specifically for the implementation of major national strategies and To build security capabilities in key areas, 1 trillion yuan will be issued this year.
Regarding the investment direction of this ultra-long-term special treasury bonds, Liu Sushe, deputy director of the National Development and Reform Commission (hereinafter referred to as the National Development and Reform Commission), introduced at a press conference held by the State Council Information Office on April 17 that the ultra-long-term special treasury bonds focus on accelerating the realization of high-end bonds. The key tasks include self-reliance in horizontal science and technology, promoting integrated urban and rural development, promoting coordinated regional development, improving food and energy resource security capabilities, promoting high-quality population development, and comprehensively advancing the construction of a beautiful China.
Director of the National Development and Reform Commission Zheng Shanjie explained the background of the issuance of ultra-long-term special treasury bonds and pointed out that this is a major strategic decision and deployment made by the Party Central Committee and the State Council with an eye on the overall strategy of building a strong country and national rejuvenation, which is beneficial to both the present and the long-term. There are several keywords, the first is national debt, the second is super long-term, the third is special, and the fourth is consecutive years. In other words, it can not only stimulate current investment and consumption, but also lay the foundation for long-term high-quality development.
Can individual investors buy it?
It is understood that China has issued fewer special government bonds.
According to the Guangkai Chief Industrial Research Institute, China has issued special treasury bonds five times in history, including three new issuances (1998, 2007, 2020) and two renewals (2017, 2022). Judging from the issuance periods of previous special treasury bonds, the short one is only 3 years, the period is relatively concentrated around 5-10 years, and the longest is 30 years. Strictly speaking, only the 30-year special treasury bonds issued in 1998 and the 15-year special treasury bonds issued in 2007 can be classified as ultra-long-term special treasury bonds, and both issuances are in line with the purpose of "implementation of major national strategies."
The earliest issuance of ultra-long-term special treasury bonds was in 1998. The 30-year 270 billion yuan special treasury bonds issued by the Ministry of Finance to the four major state-owned banks were the first batch of "ultra-long-term special treasury bonds", mainly to supplement the capital of wholly state-owned commercial banks. And other issues. In 2007, 1.55 trillion yuan of special treasury bonds were issued to fund the establishment of the National Foreign Exchange Investment Corporation.
Judging from the issuance schedule, 7 20-year ultra-long-term special treasury bonds will be issued this year, including 2 initial issues and 5 renewals, which will be issued as early as May 24; 12 30-year ultra-long-term special treasury bonds will be issued , including 3 initial issuances and 9 renewals, which will be issued as early as May 17; it is planned to issue three 50-year ultra-long-term special government bonds, including 1 initialization and 2 renewals, which will be issued as early as June 14. The specific amount of each issuance has not yet been disclosed, and the interest payment method is semi-annual.
Can individual investors purchase ultra-long-term special government bonds? Guangkai Chief Industrial Research Institute believes that for individual investors, whether they can participate in the subscription depends on the target of the specific bond batch. Judging from past experience, the 1998 special treasury bonds were issued to institutions, while the 2020 anti-epidemic special treasury bonds clearly encouraged individuals and small, medium and micro enterprise investors to subscribe.
Source: Sino-Singapore Jingwei
