According to report from the ‘2017 China Steel Technological Economy Top Forum’ on September 16th, China’s ten major steel enterprises have signed debt-to-equity swaps agreements that are worth about 150 billion yuan since the beginning of the new round of debt-to-equity swap. An official of the Ministry of Industry and Information Technology said at the forum that China will speed up deleveraging in the steel industry to solve practical problems for the next step. The government will pay more attention to the implementation of those agreements and give strong support to the relevant enterprises by providing more available financing channels.
JUMORE Reviews
Although ten steel enterprises signed debt-to-equity swaps agreements, only two of them have been put into practice. Since most of the debts still are‘real debts’ after the swaps, which in fact can not allow enterprises to shake off heavy financial burden and attract funds from financial institutions, the difficulty of actually implementing the debt-to-equity swaps still exists. In order to give full play to the debt-to-equity swaps, the steel industry itself should deepen the supply-side reform through a series of effective measures to achieve structural optimization and upgrading of the entire industry chain.
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