China’s capital markets activity is at record lows
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Activity in China’s capital markets has fallen to multi-year lows, reports Financial Times.
Thus, according to Dealogic, this year Chinese companies raised only $6.4 billion through IPOs and subsequent stock offerings, which is the lowest figure in the history of statistics.
The volume of funds raised by Chinese companies in offshore markets, including Hong Kong, amounted to $1.6 billion. This is the minimum amount since 2003. And the volume of mergers and acquisitions in China amounted to only $2.5 billion, which is the lowest level since 2005.
As the newspaper notes, the drop in activity in the capital markets indicates falling investor confidence in the country’s second-largest economy, which is experiencing problems due to falling consumer activity and a large-scale crisis in the real estate market. Taking into account all the negative factors, Fitch last week confirmed China’s long-term foreign currency issuer default rating at A+, however lowered forecast from stable to negative. The Ministry of Finance of the People’s Republic of China expressed regret over Fitch’s decision.
At the end of 2023, China’s GDP increased by 5.2% in annual terms, which was higher than the official forecast set at about 5%. The GDP amounted to 126.058 trillion yuan ($17.6 trillion). In March, Chinese Prime Minister Li Qiang at the National People’s Congress designated The country’s official GDP growth target for 2024 is 5%.
Why the US Treasury is dissatisfied with the volume of Chinese products – in the Kommersant publication “Too many PRC”.
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