Abstract Moody's Investors Service released a report in early March to maintain China's sovereign credit rating “Aa3â€, but adjusted its rating outlook from “stable†to “negativeâ€. ...
Moody's Investors Service released a report in early March to maintain China's sovereign credit rating "Aa3", but adjusted its rating outlook from "stable" to "negative." On March 30, the main person in charge of the Finance Department of the Ministry of Finance responded to media questions and said that Moody's only expressed certain concerns about the problems in China's economic and financial operations under the current extremely complicated world economic situation. However, these issues do not actually constitute sufficient reasons for downgrading the rating outlook, indicating that the rating companies need to further understand the situation in China and eliminate “information asymmetryâ€. He stressed that from the perspective of market influence, after Moody's downgraded China's sovereign credit rating outlook, the domestic stock market, bond market, and RMB exchange rate trend were not affected by the downward revision of the outlook. The overseas sovereign bond yield and the offshore RMB exchange rate did not appear. Fluctuations indicate that market investors have maintained strong confidence and good expectations.
Government debt risk is generally controllable
In response to the debt risks that the outside world is worried about, the main person in charge of the Finance Department of the Ministry of Finance said that according to the 2016 budget draft, the local government's general debt and special debt balance limits totaled about 17.2 trillion yuan, and the local government debt ratio is expected to remain below 100. % risk alert level, the risk is generally controllable.
He pointed out that China's current government debt ratio is about 40%. In 2016, China will continue to implement a proactive fiscal policy, including expanding the fiscal deficit and increasing the deficit rate to 3%. Considering that China's government debt ratio and fiscal deficit rate are at a low level in the world's major economies, proper improvement is still safe and feasible. At the same time, the government's appropriate addition of a little leverage will also help support the real economy enterprises to leverage and achieve a stable growth, structural adjustment and de-leverage balance.
Corporate debt is at a reasonable level
In response to concerns that the leverage ratio of Chinese companies has risen and the existence of “zombie enterprises†poses a risk hazard, the main person in charge of the Finance Department of the Ministry of Finance responded that the debt level of Chinese enterprises is still at a reasonable level. From the perspective of asset-liability ratio, according to relevant statistics, the current asset-liability ratio of real economic enterprises is about 60%, which is only about 5 percentage points higher than that in 2009. Compared with the internationally recognized warning line of 70%, it is still at a reasonable level.
He introduced that in order to solve the structural problems of debt, some measures have been taken and positive results have been achieved. As of the end of 2015, direct financing in the social financing scale accounted for 13.9%, an increase of 1.3 percentage points over the previous year.
In response to the reporter's question about the progress of the Ministry of Finance's PPP work, the main person in charge of the Finance Department of the Ministry of Finance responded that after more than two years of promotion, the PPP concept has been deeply rooted in the hearts of the people, and the government departments gradually moved from the public service managers and providers to the supervisors. The transformation of partners has changed from heavy construction, refinancing to heavy operations and heavy cooperation.
He introduced that up to now, the country has promoted 6,650 PPP projects with a total investment of 8.7 trillion yuan, mainly involving transportation, municipal engineering and tourism.
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