, Columnist
The Dollar Squeeze Is Coming for China Inc.
After the coronavirus hit, markets are too jittery for the same old debt rollover.
The squeeze is on.
Photograph: Getty Images
This article is for subscribers only.
Pummeled by the coronavirus, China Inc. now faces another disruption: a global shortage of dollars.
Chinese companies are looking at $120 billion of debt repayments this year on their U.S. dollar denominated debt. Real estate developers and industrial companies make up three-quarters of the outstanding $233 billion of junk-rated bonds. There’s another $563 billion of higher-rated debt. The question isn’t just whether they’ll be able to pay their debt. It’s worth wondering how they can access the needed dollars — and at what cost.