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China suffers first dollar-bond default by SOE in two decades

Debt plan for commodities trader Tewoo spotlights credit risks as economy slows

Beijing risks facing further defaults by state-owned enterprises as China's economy slows.   © Reuters

HONG KONG -- Bondholders of commodities trader Tewoo Group accepted heavy losses as part of a debt restructuring plan, in a move S&P Global Ratings dubbed the first offshore default in two decades by a Chinese state-owned company.

The restructuring of bonds issued by Tewoo, which is based in the northern port city of Tianjin, underscores the credit risks ahead for China as a slowing economy curtails the ability of state-run enterprises to meet principal and interest payments.

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