China

Chinese builder Sichuan Languang Development Co. failed to repay a local bond, marking its first default in a domestic credit market grappling with rising debt failures, Bloomberg News reported. The company was not able to raise enough funds for the repayment on a 900 million yuan ($139 million) local bond that matured Sunday, which amounts to a default, according to a Monday statement from Languang to the Shanghai Clearing House. The builder said last week it might not be able to make the payment.

China has prospered during much of the coronavirus pandemic as the world’s factory, making everything from face masks to exercise equipment for housebound consumers. Demand for its products doesn’t appear to be slowing even as Western economies reopen, the New York Times reported. China’s General Administration of Customs announced on Tuesday that the country’s exports surged 32.2 percent in June compared with the same month last year.

Those in the business of mining cryptocurrencies are rushing to leave China, which had accounted for 60% of global bitcoin mining, as the nation tightens restrictions on such activities, Nikkei Asia reported. China, which is already testing a digital yuan, has moved early to rein in other virtual currencies, sparking widespread disruption. The government in May announced tougher restrictions targeting cryptocurrency mining and transactions.

Singapore property group City Developments Limited (CDL) has said it will continue to limit further exposure to a China unit, which is now facing a bankruptcy claim, the Straits Times reported. CDL reiterated in a filing to the Singapore Exchange on Thursday that it has "ring-fenced its current financial exposure" to its investment in Sincere Property, and will not support the unit's continuing financial obligations. "Despite the bankruptcy proceedings, the group will continue to strenuously protect its position and limit further exposure," said CDL.

Tsinghua Unigroup Co., a key player in China’s push for self-reliance in semiconductors, said Friday that one of its creditors has asked a court to begin bankruptcy proceedings for the group, the Wall Street Journal reported. The state-backed chip maker said that it had received a notice from a Beijing court saying that Huishang Bank Corp Ltd. , a Hong Kong-listed bank based in Anhui province, has requested the court to start bankruptcy and reorganization proceedings, on the grounds that it has failed to repay its debts, according to a Unigroup filing to the Shanghai Stock Exchange.

China issued a sweeping warning to its biggest companies, vowing to tighten oversight of data security and overseas listings just days after Didi Global Inc.’s contentious decision to go public in the U.S., Bloomberg News reported. While the statement from China’s State Council on Tuesday was thin on details, it suggests Beijing is preparing to intensify a crackdown on its corporate sector that has spanned everything from property debt and fintech to antitrust issues and now cybersecurity.

Didi Global Inc. shares fell as much as 25% in early U.S. trading on Tuesday in the first session since Chinese regulators ordered the company's app to be taken down days after its $4.4 billion listing on the New York Stock Exchange, Reuters reported. The ride-hailing giant's app was ordered to be removed from mobile app stores in China on Sunday by the Cyberspace Administration of China (CAC), which had said it was investigating Didi's handling of customer data.

Chinese billionaire Zhang Jindong has received a $1.36 billion state-backed bailout of the troubled retail arm of his Suning empire, marking another step in Beijing’s efforts to clean up its heavily indebted conglomerates, Bloomberg News reported. A group of investors, led by the Nanjing state asset management committee and the Jiangsu provincial government, will take a 16.96% stake in Suning.com Co., according to a statement Monday. The deal was struck at 5.59 yuan a share, the near eight-year low the stock was trading at before it was halted June 16.

China’s corporate credit market is the world’s biggest, after the U.S. The government has backstopped even the most reckless companies, fending off defaults where they were arguably long overdue. But those days are now drawing to a close as Beijing forces more accountability on its weakest companies to reduce moral hazard, according to a Bloomberg News commentary. In China, the current default rate is around 1%; in more developed markets, it’s closer to 2% to 3%. Removing government support in order to close that gap is a delicate process.

Suppliers to Walmart, Target, Amazon.com and other major retailers told Reuters they are placing holiday orders for Chinese-made merchandise weeks earlier this year, as a global shipping backlog threatens to leave many gift buyers empty-handed this Christmas shopping season. Reuters surveyed nearly a dozen suppliers and retailers of everything from toys to computer equipment in the United States and Europe.