The mainland's official foreign borrowings slowed sharply in the 12 months to June as the international banking community tightened lending following several high-profile failures by mainland companies to repay back loans.
As of June 30, foreign debt rose 7.8 per cent year on year to US$148.77 billion, compared with the growth rate of 16.3 per cent in the previous comparable period, according to data from the State Administration of Foreign Exchange (SAFE).
In the first six months of this year, the debt had risen 1.9 per cent, or $2.73 billion, compared with the growth rate of 5.3 per cent in the first half of last year, Xinhua news agency reported yesterday.
Analysts said the sharp slow-down largely stemmed from foreign banks' cautious lending to mainland entities following the collapse of Guangdong International Trust and Investment Corp and revelation of financial troubles surrounding Guangdong Enterprises (Holdings), the investment arm of the Guangdong provincial government.
At present, just the finance ministry and a few other mainland financial institutions bearing sovereign or quasi-sovereign risks can manage to raise money on the international debt markets.
SAFE figures show medium- and long-term debts amounted to $131.67 billion, accounting for 88 per cent of the total and $2.97 billion higher than the end of last year.