Infrastructure projects in China’s Guizhou province have resulted in mounting debt. Photo: Xinhua
Infrastructure projects in China’s Guizhou province have resulted in mounting debt. Photo: Xinhua

China debt: distressed state-owned financing vehicles eye long-term restructuring, even as ‘default is the easiest choice’

  • Mounting debt at local levels across China back in the spotlight after 20-year rollover raises concerns about how far banking sector has to go in handling the blow from cash-strapped firms that cannot repay loans on schedule
  • Transparency in borrowings and use of funds is often weak, prompting Beijing to become increasingly wary of so-called hidden-debt risks

Infrastructure projects in China’s Guizhou province have resulted in mounting debt. Photo: Xinhua
Infrastructure projects in China’s Guizhou province have resulted in mounting debt. Photo: Xinhua
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