A Closer Look at China Debt
Teresa Kong, CFA, Portfolio Manager
July 6, 2016
Investors have grown increasingly concerned about the build-up of debt in China. In 2007, the nation had only US$7.4 trillion of debt, which was equivalent to approximately 158% of GDP—a number somewhat within the realms of sensible expectations. Fast forward to just mid-2014 and McKinsey estimates that Chinese debt has expanded by more than 120% of GDP and to around US$28 trillion in debt, or around 4x the quantity that existed previously. More recent estimates are obviously substantially higher, with January 2016 alone witnessing a rise of US$519 billion. Are China’s debts sustainable or a sign of serious mismanagement of its economy? In this video, Portfolio Manager Teresa Kong, CFA takes a closer look at the implications of China’s mounting debts, capital outflows and the ongoing development of China’s on- and offshore fixed income markets.
Visit our Glossary of Terms page for definitions and additional information.
Most recent videos
On the Ground with Andy Rothman
Second Quarter 2018 CIO Review and Outlook
China's Small Companies Win Through Innovation
China: 20 Years of Investing