A slew of China’s leading state-owned enterprises SOE’s have drafted debt reduction plans for the next two years amidst Beijing’s ongoing deleveraging campaign.
According to state-owned media six of China’s top SOE’s have already completed their deleveraging plans and submitted them for approval to the State Asset Supervision and Administration Commission (SASAC).
These companies include China Railway Construction Corporation, China State Construction Engineering Corp, China Merchants Group, Huaneng, Huadian and Sinopec Group.
SASAC itself will soon release a “work” plan for capping the debt ratios of the 96 SOE’s that currently fall under its jurisdiction.
Last year Presisdent Xi Jinping pointed to the corporate sector and heavily indebted SEO’s in particular as the “priority of priorities” for China’s deleveraging campaign.
The debt-asset ratios of central SOE’s were 66% on average as of the end of June, for a decline of 0.3 percentage points compared to the start of the year, and total debt of around 36 trillion yuan.
Beijing wants the 96 companies under SASAC’s jurisdiction to reduce debt-asset ratios by 2 percentage points on average by the end of the decade.