China front-loads $142 billion in 2020 local government bonds to spur growth

China has brought forward 1 trillion yuan ($142.07 billion) of the 2020 local government special bonds quota to this year as it seeks to avert a sharper economic slowdown. The finance ministry said on Wednesday that local governments must ensure that special purpose bonds - used to finance infrastructure projects - can be issued and used as early as possible.

"To ensure we can see results early next year ... and the economy can be effectively boosted as soon as possible," the ministry said in a statement on its website.

The front-loaded debt quota was equivalent to 47% of the 2019 quota, it said. Beijing has been leaning more heavily on fiscal stimulus to weather the current downturn, announcing 2 trillion yuan in tax and fee cuts this year and 2.15 trillion yuan in special local government bond issuance.

China's economic growth cooled to a near 30-year low of 6% in the third quarter, and may dip lower in the fourth quarter amid a trade war with the United States. Analysts do not expect an interim trade deal to brighten the outlook any time soon as the tariff war has only exacerbated a slowdown caused by weaker domestic demand.

Many local governments are facing increasing fiscal strains as the tax cuts and the broader economic slowdown reduce their revenues, hampering their ability to carry through on big infrastructure projects which Beijing is counting on to revive growth.