China's debt risks 'controllable' but challenges remain: vice finmin
- Donald Trump Sworn in as 45th U.S. President
- Wall Street ends higher as Trump becomes president
- Walgreens Boots Alliance (WBA) Said to Face Antitrust Concern for Rite Aid (RAD) Fix - Bloomberg
- Bristol-Myers Squibb (BMY) Says It Won't Pursue Accelerated U.S. Regulatory Pathway for Opdivo Plus Yervoy in Lung Cancer
- Apple (AAPL) Sues Qualcomm (QCOM) Over Patent Royalties in Antitrust Case - Bloomberg
China's Vice Finance Minister Zhu Guangyao, attends a conference during the 2016 IIF G20 Conference at the financial district of Pudong in Shanghai, China, February 25, 2016. REUTERS/Aly Song - RTX28GNI
Get access to the best calls on Wall Street with StreetInsider.com's Ratings Insider Elite. Get your Free Trial here.
SHANGHAI (Reuters) - The risks from debt in China are "totally controllable" but there are challenges that must be given serious consideration, such as the accelerating growth of corporate debt, state news agency Xinhua quoted Vice Finance Minister Zhu Guangyao as saying.
The government had already adopted a number of measures to prevent and resolve corporate debt risk, particularly as it relates to state-owned enterprises, Zhu was quoted as saying on Monday.
Publicly available data, including from the International Monetary Fund, "reflect the fact that China's debt risk is totally controllable," Zhu said.
"Of course, challenges also exist, such as the recent phenomenon of corporate debt growth that is too fast, which needs to be taken seriously and (watched for) vigilantly."
Beijing on Oct. 10 unveiled guidelines for a plan to lower the country's $18 trillion corporate debt - now at 169 percent of domestic output - by allowing stressed companies to swap part of their debt for equity investment.
China's efforts to curb corporate leverage, especially among state-owned companies, are targeted at reviving a slowing economy.
International institutions have warned Beijing to stop financing weak firms, especially inefficient state-owned enterprises, which tend to crowd out the private sector.
They also say the government needs to allow more defaults to improve credit allocation and stop wasteful spending in the economy.
Excessive credit growth in China is signaling an increasing risk of a banking crisis in the next three years, the Bank of International Settlements (BIS) warned recently.
(Reporting by John Ruwitch and Wang Jing; Editing by Shri Navaratnam)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Senate approves Mattis to lead Pentagon, first Trump cabinet member
- U.S. asks South Korea to arrest former U.N. chief Ban's brother
- North Dakota landowners sue over pipeline easement payments
Create E-mail Alert Related CategoriesReuters
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!