On May 14, the Chinese government announced that by September it would complete the first phase of a new plan allowing local governments to swap outstanding loans for low-yield, slow-maturing local bonds. Under the plan, localities would have a steady and stable path for repaying the more than $3 trillion in local government debt accumulated during the past six years of rapid post-financial crisis spending. The plan also has the added benefit of lowering local government debt-servicing costs, thus freeing up tens of billions of yuan in liquidity in the short run. While the plan is a welcome departure from the Chinese government's previous ad hoc methods of managing local government debt maturation, it does not address the larger and more pressing issue of corporate debt. In addition, no comparable plan for managing corporate debt exists.