China has overtaken the U.S. as the world’s largest issuer of corporate debt, but a slowing Chinese economy and the weakened financial health of its companies are creating risks globally, according to Standard & Poor’s Ratings Services.
The assessment by the U.S. rating firm echoes growing concerns over the health of China’s financial system, as stresses rise among struggling property developers and cash-strapped local governments. Adding to the worries is the fact that Beijing has started allowing some small, private borrowers to default on loans and bonds, suggesting a reduced willingness by the state to bail out troubled firms.
In a report released on Monday, S&P said it expects companies around the world to seek up to $60 trillion in new debt and refinancing between 2014 and 2018, an increase from an estimated $53 trillion for the 2013-2017 period. Asian-Pacific corporate issuers will likely account for half of the $60 trillion, and more than half of the $72 trillion in debt the ratings company projects will be outstanding in 2018.
Read Full Article HERE
Shen Hong, The Wall Street Journal via CHINA US Focus http://ift.tt/1p9qUR4
No comments:
Post a Comment