The State Council, or the Cabinet, said Wednesday that local government debt is relatively heavy and has potential risks, which needs high attention.
Local governments have amassed a relatively large amount of debt and the ability of certain regions and industries to repay the debt is weak, the State Council said in a statement released after an executive meeting presided over by Premier Wen Jiabao.
There were some problems in management, tax, finance, investment of some major projects related to people's livelihoods, according to the statement.
Further, some centrally-administered state-owned enterprises had conducted some irregularities in making key decisions, accounting and internal control, the statement said.
The problems indicated that "there are loopholes in some mechanisms and management, which therefore needs high attention," the statement said.
The comments were made after the National Audit Office launched a campaign to check and audit debt of local authorities, financing vehicles and projects for 2010 in the first half of this year.
According to the statement, effective measures were needed to defuse debt risks and efforts to clean up and regulate local government financing vehicles.
The government will look into setting up a mechanism to better regulate the way local governments raise funds.
The meeting also approved a development plan for Tibet Autonomous Region in the five years to 2015, which includes 226 construction projects in infrastructure, environmental protection, competitive industries and with regard to people's livelihoods. The statement did not specify how much money would go into the projects.
The statement said fixed-asset investment in Tibet in the following five years will increase significantly compared with the previous five years, but the exact amount of investment was not given.
In the five years to 2010, total fixed-asset investment in the region topped 165.6 billion yuan (25.6 billion U.S. dollars), the record high, the statement said.
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