China's debt defaults will not post systemic risk: govt document

[BEIJING] China's debt defaults will not pose a systemic risk as long as economic growth remains within a reasonable range, according to a government document on Thursday.

The country's overall debt risk is generally controllable, and corporate leverage ratios even have room to rise if economic growth is not stable, said the document, distributed prior to a news briefing.

Representatives of the central bank, finance ministry and the main economic planning agency are speaking at the briefing, which is being held to discuss issues around China's debt.

China will maintain proactive fiscal policy and prudent monetary policy in order to avoid any economic hard landing, the document said.

China's total debt load rose to 250 per cent of GDP last year, and the IMF recently warned that the high corporate debt ratio of 145 per cent of GDP could lead to slower economic growth if not addressed.

REUTERS