On March 5, China's Ministry of Finance announced it is planning to ban all future guarantees provided by local governments for loans they receive from local investment firms and that new rules will be drafted to control local-government spending. This followed a Feb. 26 announcement by China's banking regulatory commission that commercial banks must stop lending to local investment firms. With 40 percent of China's record 9.6 trillion yuan (about $1.4 trillion) in new-loan growth going to local governments in 2009 — and with increasing public debt and credit risk — banking regulators are concerned about the ability of local governments to borrow without central government oversight. For the past three decades, Beijing has struggled to gain control over local-government spending. In the 1980s, China's tax system was decentralized, which gave local governments more control over tax collection and spending.