Founder of China's Embattled LeEco Placed on Debt Blacklist

Engen Tham, Adam Jourdan
Reuters
The high-profile founder of struggling Chinese tech conglomerate LeEco has been placed on an official blacklist of debt defaulters, a further blow to a firm that had spent heavily to compete in areas from smart cars to online entertainment.

China's Debt Levels Pose Stability Risk, Says IMF

Guardian
Fears that China risks being the cause of a fresh global financial crisis have been highlighted by the International Monetary Fund in a hard-hitting warning about the growing debt-dependency of the world’s second biggest economy.

Chinese Shadow Banking Has Slowed — but That's Not as Good as It Seems

Huileng Tan
CNBC
China is on a drive to reduce its reliance on debt, a habit that some experts warn could lead to a global financial crisis.

China to Debtors: Pay up or Be Shamed

Keith Bradsher and Ailin Tang
New York Times
Troubled by huge debts run up by big state companies and politically connected local governments, China is taking steps instead to go after the little guys.

As China Piles on Debt, Consumers Seek a Piece of the Action

Keith Bradsher and Ailin Tang
New York Times
Chinese central bank data shows that consumer loans have grown almost 50 percent since the start of last year, and the International Monetary Fund said it expected China’s household debt as a percentage of its economic output to double by 2022...

China Reclaims Spot as World's Biggest Holder of Treasuries

Andrew Mayeda and Katherine Greifeld
Bloomberg
China reclaimed its position as the top foreign owner of U.S. Treasuries after increasing its holdings for the fifth straight month.China’s holdings of U.S. bonds, notes and bills rose to $1.15 trillion in June, up $44.3 billion from a month earlier...

Debt-Ridden Chinese Giant Now a Shadow of Its Former Size

Keith Bradsher
New York Times
The Han Show here in central China was supposed to turn the city of Wuhan into a leading tourist destination, with a dazzling spectacle of lights, water jets and acrobats by the former creative director of Cirque du Soleil. But the custom-built 2,...

In China, Shoppers Buy Bad Loans Online with Their Groceries

Bloomberg
Among the sneakers, diapers, and pet food for sale on Taobao, China’s biggest e-commerce platform, is a listing that may take up a little more space in the online shopping basket.

Alibaba Predicts Strong Sales in a Sign of Strength from China

New York Times
The Alibaba Group signaled on Thursday that for all the global worries about China’s rising debt and bloated state industries, its economy still enjoys a strong pillar of support: online shoppers.

Chinese Debt in Africa: How Much Is Too Much?

Eric Olander, Cobus van Staden & more
China now owns more than half of Kenya’s external debt, and that figure is likely to grow even higher as President Uhuru Kenyatta turns to Beijing to finance large infrastructure projects across the country. Most recently, China completed the first...

China Has a Huge Debt Problem. How Bad Is It?

CNN
Credit rating agency Moody’s downgraded China this week, warning that the country’s financial health is suffering from rising debt and slowing economic growth. It’s the first time the agency has cut China’s rating in nearly three decades.

China’s Downgrade Could Lead to a Mountain of Debt

Bloomberg
The downgrade of China’s debt by Moody’s Investors Service may push Chinese companies to borrow even more money from domestic banks as overseas debt becomes more expensive, increasing risks for the nation’s finance industry.

Caixin Media

05.05.17

Belt and Road: A Symphony in Need of a Strong Conductor

In just a few weeks, the Chinese president will host the Belt and Road summit—Xi Jinping’s landmark program to invest billions of dollars in infrastructure projects across Asia, Africa, and Europe. Reactions to the project have been, understandably...

China Bankruptcy Cases Surge as Economy Slows

Tom Hancock
Financial Times
Rise in liquidations reflects growing role for courts in tackling ‘zombie’ companies

How China’s Dumping of Treasurys Will Affect U.S. Borrowing Costs

Jon Sindreu
Wall Street Journal
Foreign buyers are holding a smaller share of the debt of the some of the world’s top nations

China’s ‘Silk Road’ Push Stirs Resentment, Protest in Sri Lanka

Voice of America
China signed a deal with Sri Lanka late last year to further develop the strategic port of Hambantota and build a huge industrial zone nearby, a key part of Beijing’s ambitions to create a modern-day “Silk Road” across Asia.

China Is Facing a Catch-22 Dilemma

Jacob Shapiro
Business Insider
A subsidiary of the Industrial and Commercial Bank of China (ICBC) has recently reached deals with seven Chinese state-owned enterprises to convert about 60 billion yuan ($8.7 billion) of unpaid loans into equity shares.

China’s Economy Grows Strongly, Yet Central Bank Eases Policy

Keith Bradsher
New York Times
China’s economy firmly hit its growth target last year, but this is China, where figures are sometimes doubted and where economists look for signs of strain underneath the numbers.

China Banks Extend Record 12.65 Trillion Yuan in Loans in 2016 as Debt Worries Mount

Sue-Lin Wong and Lusha Zhang
Reuters
China’s banks extended a record 12.56 trillion yuan ($1.82 trillion) of loans in 2016 as the government encouraged more credit-fueled stimulus to meet its economic growth target

China Inc.’s Large Dollar Debts Fuel Beijing’s Efforts to Curb Yuan Plunge

Ling Ling Wei
Wall Street Journal
The large pile of foreign debt owed by Chinese companies, from state-owned banks to airlines, is giving added impetus to Beijing’s efforts to keep the yuan from falling too steeply against the rallying dollar.

Heralding Social, Financial Change, China Aims Blow at Iron Rice Bowl

David Stanway
Reuters
China has ordered state firms to smash the decades-old system of providing cradle-to-grave welfare support, known as the country's "iron rice bowl"...

China Central Bank Extends Emergency Loans to Financial Firms

Rachel Rosenthal and Yifan Xie
Wall Street Journal
Extends hundreds of billions of yuan in loans to ease liquidity crunch, continuing debt selloff

Meet the Ma Family: How Millennials are Changing the Way China Thinks About Money

Engen Tham and Adam Jourdan
Reuters
China's millennials - roughly those aged between 18 and 35 - are embracing debt like never before...

In China, Trump-Style Infrastructure Partnerships are Used to Hide Debt

James T. Areddy
Wall Street Journal
To pay for a highway project, Wenling’s government teamed up with Bank of China to create an ‘industrial fund’ that pulls in money from ordinary investors

China’s Latest Debt Crackdown Just Delays More Serious Action

Anjani Trivedi
Wall Street Journal
China’s dilemma: how to manage a huge debt mound while maintaining loose monetary policy

Relax, China’s Banks Aren’t About to Have a Meltdown

Tom Holland
South China Morning Post
There are reasons to be worried about China’s debt, but the risk of a 2008-style crisis is not one of them.

China Rethinks Its Alliance With Reeling Venezuela

Kejal Vyas
Wall Street Journal
Concerns prompted emergency meetings between the Chinese envoy and state companies.

Media

08.25.16

China Analysts Should Talk to Each Other, Not at Each Other

Scott Kennedy
On August 12, the International Monetary Fund (IMF) issued its annual report card on China’s economy and gave the country mixed grades, finding that its “economic transition will continue to be complex, challenging, and potentially bumpy.” In...

China Shares Hit Seven-Month High; World Yields Keep Falling

Marc Jones
Reuters
Chinese stocks helped offset news that Japan’s economic growth had ground to a halt.

Caixin Media

08.09.16

China's New 'Bad Loan' Managers: Savvy Saviors or Riskier than Ever?

As China's economy slows and defaults rise, 'bad loan' managers say they spot an opportunity to pick up bargains, because lenders are eager to shed toxic debt that might otherwise poison the broader financial system. Yet questions...

Conversation

05.24.16

How Much Debt Is Too Much in China?

Yukon Huang, Houze Song & more
In the first quarter of 2016, Chinese debt rose to 237 percent of GDP—a level comparable to that of the U.S. or the Eurozone and yet much larger than that of most developing economies, according to analysis by The Financial Times. Additionally,...

China Party Mouthpiece Echoes Soros' Debt Fears

Tom Mitchell
Financial Times
‘Authoritative’ source warns party paper of ‘deadly’ risk to economy.

Caixin Media

04.05.16

No Point in Ramping Up Personal Debt to Help Property Market

Having banks and local governments deleverage and trim overcapacity are part and parcel with central government efforts to maintain stable growth by nurturing the supply side of the economy. But even as this is happening, the housing market has been...

Africa Feels the Chill of China’s Cooling Economy

Eric Olander, Cobus van Staden & more
It hasn’t even been a month since Chinese president Xi Jinping was in South Africa for the triennial Forum on China-Africa Cooperation (FOCAC) confab where he unveiled a massive $60 billion financial package. Oh how those were innocent, halcyon days...

Great Fall of China Sinks World Stocks, Dollar

Sinead Carew
Reuters
A near 9-percent dive in China shares and a sharp drop in the dollar and major commodities sent investors rushing for the exit.

Why it is Better to Stay Out of China A-shares

John Authers
Financial Times
Where did the argument for China A-shares go? In the last two weeks the case for the booming stock market of mainland China has turned at least two somersaults.

Caixin Media

01.20.15

Good Times Are Over for Local Governments

Two pieces of recent news have piqued the public's interest. First, local governments reported their latest debt figures to the Ministry of Finance. The numbers have not been made public, but sources say many officials reported large amounts in...

Features

12.10.14

Why Beijing’s Troubles Could Get a Lot Worse

from Barron’s
Few foreigners know China as intimately as Anne Stevenson-Yang does. She has spent the bulk of her professional life there since first arriving in 1985, working as a journalist, magazine publisher, and software executive, with stints in between...

Ministry Said to Propose Local Governments Issuing Bonds to Cover Debts

Huo Kan
Outstanding central and local government debt totaled 20.7 trillion yuan at the end of June last year, data from the National Audit Office show.

China Isn’t Overtaking America

Michael A. Levi
New York Times
Twenty-first century rivalry between the United States and China will be as much about economic might as military power.

Seeing Its Own Money at Risk, China Rails at U.S.

Mark Landler
New York Times
China has become shrill in its criticism of the fiscal train wreck in the United States, arguing that the answer to a potential government default is to begin creating a “de-Americanized world.” 

Conversation

10.16.13

Uncomfortable Bedfellows: How Much Does China Need America Now?

Bill Bishop, David Schlesinger & more
Bill Bishop:The D.C. dysfunction puts China in a difficult place. Any financial markets turmoil that occurs because of a failure of Congress to do its job could harm China’s economy, and especially its exports. The accumulation of massive foreign-...

China to United States: Don’t Default, For Our Sake

Dan Kedmey
Time
One day after Republican House Speaker John Boehner promised to “stand and fight” over the budget, Chinese officials pleaded with America’s deadlocked Congressmen to stand down, because otherwise China, the U.S.’s biggest creditor, will be...

China Locks Foreign Investors Out of Another Bad-Debt Cleanup

Stephen Aldred
Reuters
Foreign investors that specialise in buying up distressed debt are queuing outside the industry's door, but bankers say China's reluctance to pay the price of a privately funded clean-up means that door probably won't open. ...

Infographics

08.12.13

Is China’s Massive Infrastructure Spending Wise or Wasteful?

China leads the world in infrastructure investment. The new roads, new railroads, new skyscrapers, even whole new cities that seem to spring into existence every day leave little doubt that investment has been ambitious. But has it been wise? This...

China Orders Government-Debt Audit as Growth Risks Rise

Bloomberg
China will start a nationwide audit of government debt this week as the new Communist Party leadership investigates the threats to growth and the financial system from a record credit boom. The State Council, under Premier Li Keqiang,...

A Chinese City is Asking Its Companies to Pay Public Sector Salaries Because It Can’t Afford Them

Jake Maxwell Watts
Quartz
Local government debt is now so unwieldy in China that some desperate city governments, such as that of western Ordos, have turned to the private sector for help to pay their employees. 

Caixin Media

04.22.13

Heading off a China-style Subprime Mortgage Crisis

Warning of local governments’ high exposure to bad debts, the credit agency Fitch recently downgraded China’s long-term local-currency rating from AA– to A+. Officials should take note: the downgrade underlines how closely international markets are...

Reports

11.01.11

The Future of International Liquidity and the Role of China

Alan M. Taylor
He Jianan
Council on Foreign Relations
Financial crises in the 1930s and 1970s showed the world that economic instability results when demand for international liquidity allows a small number of countries to run up massive debts in their own currencies. Named for the economist who first...

Reports

09.26.11

China’s Holdings of U.S. Securities: Implications for the U.S. Economy

Wayne M. Morrison, Marc Labonte
Peony Lui
Congressional Research Service
Given its relatively low savings rate, the U.S. economy depends heavily on foreign capital inflows from countries with high savings rates (such as China) to meet its domestic investment needs and to fund the federal budget deficit. The willingness...