The debt ratios of SOEs and local.............>

CHINA: The debt ratios of SOEs and local governments need to be closely watched,

Li Yang, a senior researcher with the Chinese Academy of Social Science and

advisor to China's leadership, said in a forum at the Renmin University on

Sunday. With China experiencing lower rates of growth, excess production

capacity and a difficult investment environment, rising leverage ratio, heavier

debt burdens and increasing non-performing loans are posing more risks, Li said.

China's financial system is marked by borrowers need to continue refinance their

loans given the lack of long-term financing options, not by capital shortage, Li

said. China should boost the use of equity in its capital market and establish

long-term credit institutions, Li said.