24 Mar 2014
China show allow corporate defaults - PBOC Deputy Governor
FXStreet (Bali) - Chinese officials keep the hard-line exhibited recently towards corp defaults, reaffirming that they should be allowed, according to PBOC Deputy Governor Hu Xiaolian.
The industries most exposed to failures in payment obligations include semiconductor, software and commodities firms, Reuters reports. According to data gathered by Reuters, Chinese businesses owe over $1 trillion in domestic bonds, with 15.8% due this year.
"The Chaori default goes to show the government will begin to let the market decide the fate of weak borrowers," said Standard & Poor's analyst Christopher Lee in Hong Kong, cited by Reuters. Lee added that defaults would be "incremental but controlled."
The industries most exposed to failures in payment obligations include semiconductor, software and commodities firms, Reuters reports. According to data gathered by Reuters, Chinese businesses owe over $1 trillion in domestic bonds, with 15.8% due this year.
"The Chaori default goes to show the government will begin to let the market decide the fate of weak borrowers," said Standard & Poor's analyst Christopher Lee in Hong Kong, cited by Reuters. Lee added that defaults would be "incremental but controlled."