China foreign debt rises to $442 billion

December 27, 2008 by · Leave a Comment
Filed under: Global News 

Debt worldwide is rising and will continue until the economy stabilizes and confidence is restored.  One item that would help this process is letting market forces choose winners and losers so that the right people prosper and the correct lessons are set.  Currently, people can  not plan for the future because of the jeopardy that the rules will continue to drastically change and they could be hurt by their decisions.  Once piece of evidence is the rush to U.S. treasuries even when your getting a negative return on your money in this environment.  

News:

China’s foreign debt grew at a slower pace in the third quarter, the country’s foreign exchange regulator said on Friday, reflecting a slowdown in investment from abroad amid the weaker global economy.

China’s foreign debt reached $442.0 billion (300 billion pounds) at the end of September, up 3.4 percent from $427.4 billion at the end of June, the State Administration of Foreign Exchange (SAFE) said on Friday.

China’s foreign debt rose 8.9 percent in the second quarter and 5.1 percent in the first quarter.  The end-September level was up 18.3 percent from the end of 2007, the foreign exchange regulator said on its website (www.safe.gov.cn).

 

Short-term foreign debt, an indicator of inflows of capital, rose to $280.0 billion at the end of September, up from $265.4 billion at the end of June. That amounted to 63.4 percent of the total.

 

But medium- and long-term foreign debt, which accounted for 36.6 percent of the total, fell $0.2 billion in the third quarter.

 

China’s short-term foreign debt was about 14.6 percent of its $1.906 trillion in foreign exchange reserves as of the end of September.

 

China’s yuan has stablised against the U.S. dollar since the second half of 2008. The country’s foreign exchange reserves fell in October for the first month since December 2003, despite a record high trade surplus of the month, suggesting that speculative capital has begun to flow out of the country.

Source: Reuters

 

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