China issues second batch of bonds to fund consumer trade

China’s state planning agency said on Friday it had issued a second batch of ultra-long-term special treasury bonds worth 62.5 billion yuan (HK$71.7 billion) to support local governments’ efforts to implement a trade-in scheme for consumer goods.

The scheme is Beijing’s flagship plan to shore up domestic demand and investors have been keen to see if subsidies will be maintained or scaled back.

It was launched in 2024, offering subsidies to consumers who replace old appliances, bicycles and even cars. This year, it has been expanded to include items such as smartphones and tablets.

The National Development and Reform Commission said in a statement it would work with the Ministry of Finance to refine plans for the use of funds and improve the efficiency of subsidy redemptions for consumers.

For the year to date, nationwide sales from trade-in programmes for consumer goods have exceeded 433.2 billion yuan, benefiting more than 60.9 million consumers, it said.

The first batch of bonds for 2026, also worth 62.5 billion yuan, was issued in December.

Analysts estimate that China will earmark about 250 billion yuan in special treasury bonds this year for the scheme, down from 300 billion yuan in 2025.

Reuters