China’s foreign debts reach $392 bn

The outstanding medium and long-term foreign debt reached USD 155.86 billion, a rise of USD 2.33 billion from the end of last year, it said, adding, during the same period, short-term foreign debt stood at USD 236.73 billion, a rise of USD 16.64 billion from the previous quarter.

In a move to curb rampant “hot money” flow from investors speculating on appreciating currency and asset prices that would exacerbate excessive liquidity and worsen inflation, SAFE has said it would tighten oversight of the cross-border money flow, specifically the outstanding short-term foreign debt.

The Chinese Academy of Social Sciences said in a report last month that about 1.75 trillion USD speculative funds flowed into China over the past five years, a sum equal to 104 per cent of China’s foreign reserves by the end of March.