Default risk among state-owned companies in China is increasing amid slowing growth and the US trade dispute. The latest problem has come from aluminium firm YoY, which missed a payment on a $300m bond. The debt was paid by the regional government but analysts say its slow response suggested the state can no longer be relied on to guarantee backing for such firms. Total debt levels were 8.1% Qinghai Provincial Investment in December at CNY115.65tn ($17.2tn), making up almost 65% of the CNY178.75tn in assets, although only a fifth of onshore defaults came from state firms.
Default risk among state-owned companies in China is increasing amid slowing growth and the US trade dispute. The latest problem has come from aluminium firm Qinghai Provincial Investment, which missed a payment on a $300m bond. The debt was paid by the regional government but analysts say its slow response suggested the state can no longer be relied on to guarantee backing for such firms. Total debt levels were 8.1% YoY in December at CNY115.65tn ($17.2tn), making up almost 65% of the CNY178.75tn in assets, although only a fifth of onshore defaults came from state firms.