China should allow local governments to go bankrupt to help rein in regional authorities’ excessive borrowing, a Chinese central bank official said.
A case like the bankruptcy of the city of Detroit in the US would convince investors that the central government is really determined to dispel beliefs of an implicit guarantee for regional authorities, People’s Bank of China (PBOC) Research Bureau head Xu Zhong (徐忠) yesterday wrote in an article in the China Business News.
Just a couple of days ago, the Chinese Ministry of Finance pledged to break the “illusion” that Beijing would bail out local governments’ hidden debt.
Their calls for limiting local borrowings are in line with the Chinese central government’s financial policy for next year.
Chinese President Xi Jinping (習近平) earlier this month said that a priority for next year is to “effectively” control leverage and prevent major risks.
PBOC Governor Zhou Xiaochuan (周小川) in October urged caution against local government financing vehicles and other means being used “to disguise debts,” and argued for fiscal reforms.
Concerns among investors about a lack of support for local funding units have led to a slump in the issuance of local governments’ debts.
Local government financing vehicles have sold 1.7 trillion yuan (US$259 billion) worth of bonds in onshore and offshore markets this year, a 23 percent drop from last year, according to data compiled by Bloomberg.
Fitch Ratings in September said that the first bond defaults by Chinese local government financing vehicles are becoming more likely.
Chinese Vice Minister of Finance Zhu Guangyao (朱光耀) on Saturday said that addressing “hidden debts” of local governments and state-owned companies’ debts are key to prevention of systemic financial risks, the China Securities Journal reported.
China can achieve a goal of doubling the size of its economy by 2020 even if annual expansion slows to 6.3 percent, a senior Chinese Communist Party official said, signaling a greater willingness to tackle debt and pollution at the expense of growth.
In its blueprint for the 2016-2020 period, China set a minimum annual growth target of 6.5 percent to achieve the goal of doubling GDP from 2010 levels.
However, over the weekend, Yang Weimin, an official from the party committee overseeing economic policy, said annualized growth of 6.3 percent from next year to 2020 would do.
Based on current economic performance, the 2020 target would not be a “huge barrier,” the official Xinhua News Agency cited Yang, deputy head of the Office of the Central Leading Group on Financial and Economic Affairs, as saying.
China is seen growing 6.8 percent this year and 6.5 percent next year, according to economists’ estimates compiled by Bloomberg.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained