China’s Unigroup International Holdings Ltd said Thursday that it was unable to repay a maturing $450 million bond by a Dec. 10 deadline, triggering cross defaults on dollar bonds worth an additional $2 billion, Reuters reported. In a statement on the website of the Hong Kong stock exchange, Unigroup International said neither it nor its guarantor Tsinghua Unigroup International Co Ltd would be able to make the principal or the final interest payment on the maturing bond.

A top Chinese chipmaker’s deepening bond crisis is sending a fresh signal that Beijing is willing to let ailing state-linked firms fail in order to instill stronger financial discipline into a recovering economy, Bloomberg News reported. Tsinghua Unigroup Co. said it won’t be able to repay the principal on a $450 million dollar bond due Thursday, which would trigger cross defaults on a further $2 billion of debt. This would be the company’s first dollar bond repayment failure and came after it defaulted on a 1.3 billion yuan ($199 million) local bond last month.

Investors are cooling on debt from riskier Chinese companies after missed payments by state-backed firms have cast doubt on the reliability of government support, The Wall Street Journal reported. The wariness has helped push new borrowing costs for these businesses to their highest levels in nearly two years, marring what has been a banner year for debt issuance. In November, corporations with below triple-A credit ratings paid an average 5.89% coupon for stock-exchange listed debt, according to Wind, the highest since January 2019. In contrast, triple-A coupon rates fell to 4.09%.

Tianqi Lithium Corp. plans to sell a minority stake in the world’s biggest lithium mine, giving the producer access to the cash it needs to repay the major loan behind its ballooning financial troubles, Bloomberg News reported. Australian miner IGO Ltd. will pay $1.4 billion in cash for a 49% stake in Tianqi Lithium Energy Australia Pty, the majority shareholder in the Greenbushes mine in the country’s west, according to a statement to the Shenzhen Stock Exchange on Tuesday.

Relations between the United States and China promise to be fraught even under President-elect Joe Biden’s administration, Bloomberg News reported in a commentary. There’s one area where the two rivals can and should cooperate immediately, however: to head off a looming debt crisis that threatens to hurl millions into poverty across Africa, Latin America and Asia. When many of the world’s poorest countries last found themselves unable to service their debts 25 years ago, the U.S. led a global effort — the 1996 Highly Indebted Poor Countries Initiative — to forgive much of that debt.

China is bucking the global trend of greater economic stimulus amid the coronavirus, preferring instead to refocus on controlling its record debt burden, Bloomberg News reported. Policy makers are allowing for tighter liquidity in the financial system, a signal that Beijing wants to stabilize the level of debt in the economy. Though not as aggressive as previous deleveraging drives, the shift is pushing up market rates: government-bond yields trade near an 18-month high and interbank borrowing costs last month jumped to the highest since January.

Creditors of China’s Yongcheng Coal & Electricity Holding Group Co have agreed to repayment plans for two commercial paper issues after the state-owned miner defaulted on them in late November, underwriters said on Friday, Reuters reported. Defaults by highly rated Chinese state firms including Yongcheng caught the world’s second-largest bond market off guard last month and prompted speculation that Beijing may be renewing a deleveraging push interrupted by the COVID-19 pandemic.

China’s fast growing $15tn onshore bond market has been rattled by a wave of defaults by state-owned enterprises that threaten to expose systemic weaknesses across the financial system of the world’s second-largest economy, the Financial Times reported. More bond defaults are expected to follow as Beijing has indicated that it is no longer prepared to help state-owned debtors that run into trouble. But the ending of China’s deeply entrenched system of implicit government guarantees has left investors struggling to price credit risks.

Rising defaults by China’s state firms are showing the need for bond investors to be much savvier about those borrowers -- no easy feat in a country where government decisions and business operations lack transparency, Bloomberg News reported. Five state-linked companies -- from a coal miner to a top chipmaker and an auto firm with ties to BMW AG -- have defaulted for the first time in the onshore bond market this year. That’s the most since 2016.

The shares of Chinese property developers have been a short seller’s nightmare for more than a decade. Nothing seemed able to dent the rally. That has now begun to change, the Financial Times reported in a commentary. Superficially, October was good for Chinese real estate. A rebound in activity pushed new home sales by floor area to their highest levels in recent months. Investment rose 13 per cent while property sales jumped 15 per cent. New construction starts grew 3.5 per cent, compared with a decline in the previous month.