Global EditionASIA 中文双语Français
Business
Home / Business / Finance

Leverage in real economy sees first drop since 2011: report

Xinhua | Updated: 2019-03-20 17:24
An employee counts bank notes at a branch of Agricultural Bank of China in Huaibei, Anhui province. [Photo by Wu He/For China Daily]

BEIJING - The leverage ratio of China's real economy last year registered its first drop since 2011, a report said.

The overall debt ratio of households, non-financial enterprises and governments declined to 243.7 percent in 2018, from 244 a year ago, according to the report of the Institute of Economics of the Chinese Academy of Social Sciences.

The decrease followed a debt growth slowdown in 2017 and, although seemingly marginal, provides evidence that the country's debt-driven period has ended. From 2008 to 2016, the leverage ratio on average jumped by over 12 percent each year.

The report attributed the downturn to a falling corporate leverage ratio, which went down by 4.6 percentage points from a year ago to 153.6 percent.

Given rising challenges at home and abroad, China has intensified efforts to defuse major risks with debt control as a top priority. Rigorous measures were adopted to curb shadow banking and regulate local government debt.

With looming downward pressures, the report suggested authorities strike a balance between controlling leverage and stabilizing growth, by measures including increasing central government bonds and advancing structural reforms.

Top
BACK TO THE TOP
English
Copyright 1995 - . All rights reserved. The content (including but not limited to text, photo, multimedia information, etc) published in this site belongs to China Daily Information Co (CDIC). Without written authorization from CDIC, such content shall not be republished or used in any form. Note: Browsers with 1024*768 or higher resolution are suggested for this site.
License for publishing multimedia online 0108263

Registration Number: 130349
FOLLOW US