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Question

Frequently Asked Questions on the Foreign Debts Borrowed by Chinese Enterprises

Answer
Q:
What are the existing management modes for foreign debts borrowed by Chinese enterprises?
A:
Currently, there are two management modes for foreign debts borrowed by Chinese enterprises. One is investment gap mode. The other one is macro-prudential management mode.

Q:
The investment gap mode can be applied to what kind of enterprises?
A:
The investment gap mode only applies to foreign invested enterprises registered in China.

Q:
What is the foreign debt quota under investment mode?
A:
The ceiling foreign debt quota for foreign invested enterprises under investment gap mode is the difference between the total investment amount and registered capital of the foreign invested enterprises.

Q:
What is the foreign debt quota under macro-prudential management mode?
A:
The ceiling foreign debt quota for Chinese enterprises under macro-prudential management mode is 2.5 times of their net assets.

Q:
The macro-prudential management mode can be applied to what kind of enterprises?
A:
The macro-prudential management mode applies to all enterprises registered in China, including domestic and foreign invested enterprises. But it does not apply to financial institutions, government financing platforms and real estate enterprises.

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