State-Owned Enterprises Leverage as a Contingency in Public Debt Sustainability Analysis: The Case of the People’s Republic of China
SHARE THIS PAGE
The size of the state-owned enterprise contingent liability in relation to the People’s Republic of China’s gross domestic product appears to be manageable if dealt with decisively and bar a continuation of the past.
The leverage of state-owned enterprises (SOE) in the People’s Republic of China (PRC) has grown to a large liability. While there is no room for complacency, there is no need for panic either; even if authorities had to step in to mop up as much as 20% of SOE debt at risk gone bad. This would appear to be manageable at roughly 2.7% of the gross domestic product in 2016 or 5.5% by 2021. The paper demonstrates a method to include SOE debt as a contingent liability in the public debt sustainability assessment framework. The authors of the paper further conclude that while corporate leverage is large, it appears fully manageable.
Contents
- Introduction
- Debt Sustainability Analysis with State-Owned Enterprise Contingent Liabilities
- State-Owned Enterprise Debt at Risk: Data Sources and Definitions
- State-Owned Enterprise Contingent Liabilities Projections and Fan Charts
- Conclusion
- Appendixes
Additional Details
| Authors | |
| Type | |
| Series | |
| Subjects |
|
| Countries |
|
| Pages |
|
| Dimensions |
|
| SKU |
|
| ISSN |
|
Published Versions
Ferrarini, Benno and Marthe Hinojales. 2019. "State-Owned Enterprises and Debt Sustainability Analysis: The Case of the People’s Republic of China." Journal of Asian Finance, Economics and Business 6 (1): 91–105. https://doi.org/10.13106/jafeb.2019.vol6.no1.91.