China vows to guard financial stability after big-name defaults

State-backed companies account for 40% of total this year

Semiconductor manufacturer Tsinghua Unigroup is at the center of President Xi Jinping's push to lessen China’s reliance on U.S. technology. © Getty Images

YUSHO CHO, Nikkei staff writer

November 23, 2020 01:19 JST

SHANGHAI -- China has pledged to step up monitoring of financial misconduct to ensure system stability after a series of high-profile defaults by state-backed companies sent shock waves across the country.

China's corporate defaults have reached 157 billion yuan ($23.9 billion) so far this year and are on track to surpass last year's record 167 billion yuan. State-owned companies, including miner Yongcheng Coal & Electricity Holding Group, chipmaker Tsinghua Unigroup and Huachen Automotive Group Holdings, account for 40% of the total.