China issues 1 trillion yuan in special bonds

China has decided to issue 1 trillion yuan ($136.79 billion) of special treasury bonds during the fourth quarter, expanding budgeted fiscal deficit rates to around 3.8 percent for the year, up from 3 percent.

The funds raised through government bonds will all be allocated to local regions, via the mechanism of transfer payment, according to the plan approved by the country's top legislature on Tuesday.

Around 500 billion yuan is planned to be utilized within the year, while the remaining half trillion yuan will be used next year.

According to the finance ministry, the funds raised will be mostly used in eight areas including reconstruction after disaster, flood prevention and management projects, and natural disaster emergency response capacity improvement projects.

The ministry said it will timely launch the bond issuance work to ensure completion of the issuance on schedule.

It will also ensure smooth transfer payment work and strengthen regulation so that the funds will be used as planned, the ministry said.