China's Shandong province will have to sell assets to pay debt: governor

BEIJING (Reuters) - Some parts of China's eastern Shandong province will have to sell off assets in order to pay down debt, the province's governor said on Saturday.

Guo Shuqing, also the former head of the country's securities watchdog, was speaking to reporters on the sidelines of the country's annual parliament.

"There are some regions, towns and counties with a high debt ratio, and repaying the capital with interest is difficult. Funds need to be raised through various channels, including restructuring, and selling off of some assets to resolve the debt repayment issues," Guo said.

"Nobody need worry. When Shandong owes a debt, it will certainly repay the money, and pay the interest."

Guo would not say how much debt the province has, but said it did not exceed to 1.2 trillion yuan (S$264 billion).

Last October, China issued new rules on handling outstanding local government debt, which stands at roughly US$3 trillion (S$4.13 trillion).

Guo also dismissed rumours that he may return to Beijing to head a financial regulator or the central bank.