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No Letup in China’s Campaign to Cut Corporate Debt

Workers prepare to dismantle machinery at a state-owned Jigang Group Co., Ltd. facility in Shandong province, on its last day of operation on Mar. 12, 2016. Photo: VCG.
Workers prepare to dismantle machinery at a state-owned Jigang Group Co., Ltd. facility in Shandong province, on its last day of operation on Mar. 12, 2016. Photo: VCG.

* Five government agencies’ joint statement vows to persist with efforts to reduce corporate leverage ratios

* Mechanism will be set up to control the debt level of state-owned enterprises, and red lines will be set for debt-to-asset ratios that must not be crossed

Chinese policymakers have signaled that curbing corporate debt, especially at state-owned enterprises, is still on the government’s agenda even as fiscal and monetary policies have taken a more pro-growth stance.

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