Economy
March 16, 2014
Wave of Defaults Expected in China
Written by Sandy Williams
Haixen Steel, a mill in Shanxi province of China, suspended operations on five blast furnaces after defaulting on a bank loans due on March 7.
Haixen is not a top tier Chinese steel mill nor is the default and shutdown a surprise to most. It is a mill heavy in debt and on the Chinese hit list for environmental violations. But the default sent a strong signal to other corporations and the Chinese steel industry that the government is serious about financial deregulation. Failed or reckless investments will no longer be bailed out by banks or the government.
