China’s debt-to-GDP ratio climbed to a new record high in 2023 despite the slow pace of borrowing, reflecting the economy’s weakening growth, a new report from a state-backed think tank shows, reports Caixin. The macro leverage ratio, which measures total outstanding nonfinancial debt as a share of nominal GDP, rose to 287.8% in 2023, 13.5 percentage points higher than a year ago, according to a report by the National Institution for Finance and Development (NIFD).
The expansion of the overall leverage ratio has outpaced the pace of borrowing. Total liabilities of household, corporate and government sectors expanded at a slower pace of 9.8% in 2023, largely unchanged from 2022 and remained at a relatively low level, according to the report.
The debt ratio held by households rose 1.3 percentage points to 63.5% while that of non-financial corporates increased 6.9 percentage points to 168.4%. The government debt ratio, meanwhile, expanded 5.3 percentage points to 55.9%.