The debt of $ 3 trillion threatens the Chinese economy


Property developers and Chinese investors have borrowed in dollars at low low levels, but now they are struggling to pay backwards, The deer builds levels of interest and a great deal has risen strongly against the dollar. yuan

Chinese companies will put pressure on paying their loans in dollars if the yuan is growing. (Picture: Forex News Now).

Debt risk is 3,000 billion dollars

The domestic debt has been a senior chief for Beijing long ago, but it has a bigger impact on loans. money with Chinese companies, which is estimated to be able to spin for financial crisis in this country, said Kevin Lai, a leading researcher for Asian markets at Daiwa Capital Markets (Japan).

Kevin Lai says that $ 3 trillion of Chinese companies are particularly vulnerable as dollars in dollar detection, yuan weakness and US-China trade war. going on.

According to Kevin Lai, a total US $ external debt is now $ 12 billion, up from $ 9 billion in 2013. 25% of this, or $ 3 trillion Air is loaned by companies in the mainland China and their subsidiary companies in Hong Kong, Singapore and the Caribbean. Cross-border debt known as a Chinese dollar is rising faster than any other emerging economy.

How the wine starts to & # 39; consolidation of financial policy in 2013 and People of Bank of China (PBoC) will carry out an exchange rate in August 2015, Jane is Increasingly increasing loan money instead of A & E reduction; problem solving related to corporate governance and efficiency.

Kevin Lai said that the world's dollar debt in the world could reach a $ 13,000 or $ 14 billion increase in consolidating US currency policy. This will mean that investors are able to; sell their stock to collect the dollar and then pay their debts in a dollar. "We need to talk about a major financial crisis, or in other words, a debt of salar debt," said Kevin Lai.

The debt known as a Chinese dollar has moved over a number of Chinese banking systems abroad. This is a difficult in the context of pressure down the yuan exchange rate.

The debt burden of the dollar arises if the yuan is sustained; go down

In the meantime, businessmen and investors in China have accepted the huge gap between the dollar and the yuan interest rates for securities loans in special interest loans, denominated asset in yuan for higher levels of interest.

But in an effort to support lending and an increase in economic growth, the PBOC has recently been up to a RMB interest rate even though the Force Reserve has set up a basic level level of the dollar. This move makes the difference between the levels of US salary interest and the resident is as soon as he does not; cover the cost of paying debts in a dollar.

On November 16, the gold exchange rate against the US dollar was set at 6,9377 yuan per dollar with its PBOC, decreased by 11 per cent against the dollar from March.

Kevin Lai, a leading economist of Asian markets at Daiwa Capital Markets, said for a lot of currency investors, that the safe trading area was around 6, 2-7 NDT will be sold at $ 1, so if yuan – the dollar will break up over 7-1, the NDT will be sold aggressively causing it to be offset; falling dramatically.

Indeed, debt with dollars is now more difficult to manage, and # 39; NDT is even more aggressive and could have a reduction of £ 3 trillion increased. "We talk about a disaster from the dollar. If NDT needs to be reduced, you'll see a debt crisis called in China."

China's Evergrande Group, China's biggest mortgage supporter, is expected to pay up, up to 11 percent, at 1.5-dollar bonds. Millions of dollars are planned for distribution. The revenue will be used to repay the loans currently from the US China Evergrande. Analysts say that many other estate development companies in China are also looking at the same situation. In the next 12 months, the companies are due to pay $ 34.8 billion in domestic bonds and $ 17.9 billion in foreign debt.

According to Saigon Economic

Source link