Changhong reveals US$500m black hole

Sichuan Changhong Electric, which at one point accounted for 90% of Chinese TV exports to the US, revealed US$500m in losses, partly resulting from declining sales but mostly from payment defaults by its American partner, California-based electronics discounter and Wal-Mart supplier Apex Digital. According to Changhong, Apex owes it US$468m. The Shenzhen-based TV maker said it might recover some of the money but was making provisions for US$310m. It said Apex defaulted after making unspecified royalty payments, and dealing with anti-dumping tariffs raising TV prices 25% and other problems that prevented it from paying Changhong, which announced the losses after 21st Century Business Herald revealed that Apex President David Ji had been arrested in Shenzhen by police investigating fraud.