China Encourages ‘High Quality’ Companies to Seek Borrowing Overseas

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The National Development and Reform Commission said Tuesday it will support leading companies to borrow foreign debts

China is encouraging domestic companies with strong business and credit records to borrow medium and long-term debt abroad amid dwindling offshore fundraising activities affected by increasing property defaults.

The National Development and Reform Commission (NDRC), the country’s top economic planner, said Tuesday it will support leading companies that promote high-quality development of the real economy to borrow foreign debts.

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China encourages well-performing domestic companies to borrow medium and long-term foreign debt to support high-quality economic development and cross-border investment.
The NDRC relaxed regulations previously tightened in January 2023, with specific criteria for qualifying companies, excluding property developers and local government financing vehicles.
By the end of 2023, China's outstanding foreign debt was $2.45 trillion, with 44% being medium to long-term debt.

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What Happened When

January 2023：: The NDRC tightened corporate overseas bond sale regulations due to concerns about soaring defaults caused by a liquidity crisis in the property sector.

By the end of 2023：: China’s total outstanding foreign debt stood at $2.45 trillion, with medium to long-term debt accounting for 44%, according to the State Administration of Foreign Exchange.

2024-07-23：: The National Development and Reform Commission (NDRC) announced support for leading companies that promote high-quality development of the real economy to borrow foreign debts.

AI generated, for reference only