Shanghai will issue China's first ever local government bonds on Nov.15 in a pilot program designated to help cash-strapped local governments to curb fast-spreading debt risks, officials said Tuesday.

The government will sell 3-year fixed-rate bonds worth 3.6 billion yuan (567 million U.S. dollars) and 5-year fixed-rate bonds worth 3.5 billion yuan, said officials with the Shanghai government's bureau of finance.

The Ministry of Finance announced in late October that the State Council, or Cabinet, had allowed the cities of Shanghai and Shenzhen and the provinces of Zhejiang and Guangdong to issue bonds on a trial basis this year as authorities explore ways to solve local government's debt issues.

The nation's auditing agency said earlier this year that local government debt totaled about 10.7 trillion yuan (1.07 trillion U.S. dollars) at the end of last year.

About 80 percent of local government debt is raised through local government financing vehicles (LGFVs), which are mainly set up to fund construction projects and have come under fierce criticism due to them being poorly supervised and managed.

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