China's Qingdao sets up firm to bail out its local govt financing arms

Qingdao city in China’s debt-laden Shandong province has set up a company to bail out its cash-strapped local government financing vehicles (LGFVs), sources said, as regional governments rush to reduce debt risks in a wobbly economy. Dongdin Industrial Group, funded by policy lender China Development Bank and having a registered capital of 10 billion yuan ($1.40 billion), is tasked with providing liquidity support to Qingdao’s LGFVs – vehicles set up by local governments to finance mainly infrastructure projects, two sources said.