(Yicai Global) June 27 -- Several local governments in China are accelerating the release of new bonds with the intention of issuing the whole year’s quota by the end of September in order to hike investment and boost a spluttering economy.

The capital city of Beijing and 15 other provincial-level regions plan to issue over CNY1 trillion (USD138.4 billion) in bonds in the third quarter, and many of them intend to use up their new bond issuance quota for this year by the end of September, Yicai Global learned.

There will be a peak in local government new bond issuance in the next three months and the entire year’s quota of CNY4.5 trillion (USD623.8 billion) will be finished by Sept. 30, Wen Laicheng, a professor at Central University of Finance and Economics, told Yicai Global.

Key economic indicators in April and May indicate that there is still great pressure on the economy, that recovery is not solid, that private investment in particular is growing slowly and that there is insufficient demand.

So local governments should issue bonds faster to achieve results as soon as possible in order to realize this year’s economic growth goal of 5 percent, Wen said. The country’s GDP expanded 4.5 percent in the first quarter.

Zhejiang in the southeast, Jiangsu in the east, Sichuan in the southwest and Hebei in the north are the four provinces leading the country in terms of bond issuance, with each preparing to release over CNY100 billion (USD13.8 billion) worth in the next three months and to have issued them all by Sept. 30.

Southeastern Fujian province is the fastest and already used up its whole-year quota in the first half.

The nation had issued around CNY4 trillion (USD554.2 billion) of local government bonds as of June 25. This consists of around CNY2.5 trillion of new bonds, which are mainly invested in major infrastructure projects, and CNY1.5 trillion in refinancing bonds, which are mostly used to repay the principal of maturing government bonds.

Editors: Tang Shihua, Kim Taylor