BEIJING, April 8 (Reuters) - China has set a quota for the total amount of short-term foreign debt banks and companies can borrow in 2014 at $43.39 billion, the nation’s foreign exchange regulator said on Tuesday, implying a rise of 16 percent from last year.
The State Administration of Foreign Exchange (SAFE) did not give a comparative figure, though it has previously said the quota was $37.3 billion in 2013.
Of the total, the quota for selected Chinese banks will be $13.9 billion while that for qualified foreign banks operating in China will be $16.54 billion, SAFE said in a statement on its website, www.safe.gov.cn.
SAFE said it would give preferential support to companies in China’s less developed central and western regions and smaller banks when it allocates the quota.
China has long kept tight controls on short-term overseas borrowings by its companies for fear of attracting speculative inflows into the country.
The foreign exchange regulator said last month it did not see any risk in China’s relatively high ratio of short-term foreign debt to total foreign debt, noting it had a large pile of foreign reserves to fall back on.
Concern has grown in recent months over the size of China’s domestic debt pile, which, coupled with a slowing economy, has sparked talk of the government stepping in to prop up growth.
China experienced its first ever domestic bond default this month, when Shanghai Chaori Solar Energy Science and Technology Co Ltd missed an interest payment on a bond it issued in 2012. (Reporting by Kevin Yao; Editing by Clarence Fernandez)