Abstract: To issue autonomous bonds by local governments has its theoretical foundation; along with the social and economic development, China has gradually qualified itself to issue autonomous bonds. The central government has decided to pilot local bond issuing, which is of great significance in both resolving local debt crisis and improving China’s fiscal system. There have been, however, some potential drawbacks in the process, for instance, the monitoring system needs to be perfected and the size of implicit debt is enormous. Consequently, in order to construct a sound local debt administrative system in China, it is indispensable to identify the reasonable scale of the local bonds, to scientifically budget their usages, and to optimize the corresponding mechanism for information disclosure and monitoring.

Key words: local government; debt crisis; local bonds; administration system of local debt