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Tuesday, October 16, 2018

China May Have $5.8 Trillion in Hidden Debt With ‘Titanic’ Risks

https://www.bloomberg.com/news/articles/2018-10-16/china-may-have-5-8-trillion-in-hidden-debt-with-titanic-risks

China’s local governments may have accumulated 40 trillion yuan ($5.8 trillion) of off-balance sheet debt, or even more, suggesting further defaults are in store, according to S&P Global Ratings.
“The potential amount of debt is an iceberg with titanic credit risks,” S&P credit analysts led by Gloria Lu wrote in a report Tuesday. Much of the build-up relates to local government financing vehicles, which don’t necessarily have the full financial backing of local governments themselves.

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