MNI: China Outstanding Foreign Debt Rose 20.8% in 2017

--Short-term Foreign Debt Accounted For 64% Of Total

     BEIJING (MNI) - Although outstanding foreign debt grew rapidly in 2017,

China's debt risk remains under control, the State Administration of Foreign

Exchange (SAFE) said Thursday.

     China's outstanding foreign debt rose 20.8% to $1.7106 trillion by the end

of 2017, compared with 2.7% growth in 2016, SAFE said. Foreign debt grew quickly

in the second and third quarter in 2017, although the pace slowed in the fourth

quarter, it said.

     The pace of growth in foreign debt in 2017 is a result of solid economic

growth and more reforms to open up markets, SAFE said. Domestic institutions can

seek funding more conveniently from abroad right now and the opening-up of bond

market increases bond investment scales from financial institutions abroad.

     All sub-indexes gauging foreign debt risk were below international

standards, though, SAFE said, noting that the ratio of foreign debt to GDP was

14% and and the ratio of short-term foreign debt to foreign-exchange reserves

was 35%.

     Outstanding short-term foreign debt stood at $1.1 trillion at the end of

the fourth quarter, accounting for 64% of total foreign debt, SAFE added.

     The regulator said it will continue to improve its counter-cyclical

management of banks and short-term capital flows in the future to prevent risks

and support real economy.

--MNI Beijing Bureau; +86 10 85325998; email: he.wei@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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