The debt risk of state-owned enterprises under the State-owned Assets Supervision and Administration Commission (SASAC) is completely manageable, said Xiao Yaqing, director of the commission, Caixin reported.
Xiao pointed out that SOEs under the SASAC’s watch have experienced strong momentum from the fourth quarter of last year onwards, indicating the risks are receding.
“We are confident to control any potential debt risk in the future,” said Xiao, adding “the debt level will continue to descend steadily.”
As of August, The average debt-to-asset ratio for SOEs was 66.5%, decreasing 0.2 percentage points from the end of 2016.
In terms of monitoring the debt ratio, the SASAC focuses on controlling financial leverage, investment size and risk, as well as setting different debt ratio warning lines for different categories of enterprises, including industrial, non-industrial and research firms.