IFR ASIA: There has been some recent discussion on securitising some of the municipal debt. DAVID YIM, STANDARD CHARTERED: Who wants to buy something that is based on some cash flow data that may not be available or isn’t transparent? That may be tough. FERNANDO MAYORGA, FITCH RATINGS: We haven’t seen many securitisations of local government debt, because normally you can’t pledge taxes. You can’t put them into a box. That just leaves fees and they’re very volatile, because the revenues of local

IFR ASIA: Let me come to you first, Fernando. Just set the scene for us here. What’s happening in the Chinese municipal sector, and why would it make sense for local government enterprises to consider the capital markets? FERNANDO MAYORGA, FITCH RATINGS: To really put it in context, I think we need to go back to 1994. I know it’s 20 years ago, but that’s when local and regional governments began to establish government-related financing vehicles, LGFVs, to do the work that usually the local gove

IFR Asia China Municipal Funding Roundtable 2015: Roundtable participants RICHARD DAWSON KPMG Richard Dawson is the head of KPMG’s capital advisory group in Asia. The group provides strategic funding advice and transaction support to governments, financial institutions, funds and corporate clients and has teams based in each of the world’s financial centers. Prior to joining KPMG in 2011, Richard worked for 16 years at RBS and ABN AMRO, most recently as head of corporate and structured debt capi

The reform of China’s local government finances is creating an opportunity out of a crisis. After years of debt-fuelled expansion, the country’s provinces and municipalities are now turning to the capital markets to consolidate their borrowings and finance future spending, presenting investors with an opportunity to diversify and underwriters with a growing revenue stream. This is a big step in the right direction, but it is no free ride. Market participants will need to tread carefully if they