Beijing continues to invest financial resources to stabilize economic growth. By the end of May, the government’s debt balance has exceeded the milestone of 100 trillion yuan for the first time, reaching 100.6 trillion yuan. This represents an increase of more than double in the past five years.
On June 12, the People’s Bank of China released the financial statistics report for May, showing that by the end of May, the government bond balance had grown to 100.6 trillion yuan, a 15.1% increase compared to the same period last year.
According to reports from the First Financial Journal, the Chinese government’s debt mainly comes from issuing national bonds and local government bonds to raise funds. The data released by the central bank indicates that the government’s debt balance has surpassed the 100 trillion yuan mark for the first time. In recent years, to offset the downward pressure on the economy, the authorities have continued to increase borrowing, raising more funds for major projects such as people’s livelihood and infrastructure development to stabilize investment and the economy. On the other hand, in order to mitigate the risks of hidden debts of local governments, a large number of bonds have been issued by local governments to replace past hidden debts, leading to a rapid expansion of the recorded debt scale.
One of the main reasons for the rapid increase in government debt in the past two years is the approval by the National People’s Congress Standing Committee in November 2024 of a local debt swap plan totaling 12 trillion yuan.
According to official statistics, in 2020, the government’s debt balance was 46.55 trillion yuan, with a debt ratio (the ratio of government debt balance to GDP) of 45.8%. By 2024, it had increased to 82.1 trillion yuan, and the debt ratio exceeded the internationally recognized warning line of 60%, reaching 68.7%. In 2025, the debt balance increased to 96.05 trillion yuan. Now, surpassing the milestone of 100 trillion yuan once again, the debt scale has more than doubled in the past five years.
Many analysts believe that with the recovery of the real estate market still to be observed and the reduction in local land transfer revenue, the Chinese authorities may continue to support economic growth through the expansion of fiscal expenditures and the issuance of bonds. Whether the government’s debt scale will continue to rise is expected to become a focus of market attention.