The Chinese corporate bond market has surpassed that of the US as the world’s largest, drawing fears that a slowdown in certain sectors could put the global economy at risk, Reuters reported, citing a Monday announcement by ratings agency Standard and Poor’s. Chinese corporate borrowers owed US$14.2 trillion at the end of 2013 versus US$13.1 trillion owed by US corporations. China is currently financing a quarter to a third of its corporate debt through its shadow banking sector, meaning that as much as 10% of global corporate debt is exposed to the risk of a contraction in China’s informal banking sector.
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