China’s bond market may have had a tricky year, with rising borrowing costs and a downturn in new issuance. But there’s one apparent bright spot—fewer bonds are going bad. The number of defaults on Chinese corporate bonds dropped to just 23 in the first half of the year, on debt worth a combined 18.7 billion yuan ($2.8 billion)—a drop in the ocean in a $4.9 trillion market, The Wall Street Journal reported. That’s down from 38 bonds worth 23.7 billion yuan in the first half of 2016, according to data provider WIND Info.

In a related story, Bloomberg News reported that China’s deleveraging campaign is taking on its toughest target yet: the public sector itself. While up to now policy makers have focused on a build-up of liabilities at smaller banks and big private-sector companies, President Xi Jinping has made clear that local government authorities and China’s behemoth state-owned enterprises too must restrain borrowing. Xi’s comments at a top financial-regulatory gathering last weekend were the latest signal of determination to head off any future destructive debt-bubble deflation.

More than 7 million Venezuelans went to the polls to vote against President Nicolas Maduro last weekend. But the more consequential opinion on Maduro's future may belong to China, Venezuela's biggest creditor and one of the few likely sources of funds needed to avert a possible default later this year, a Bloomberg View reported. The unofficial referendum, which was organized by the opposition, showed the depth of popular discontent with Maduro's plans to rewrite the constitution and enshrine himself in office. Turnout, at more than a third of registered voters, far exceeded expectations.

China’s economy grew faster than expected in the second quarter, putting the nation on track to meet its growth target this year and giving backing to officials in their campaign to corral oncoming financial risk, Bloomberg News reported. Data showing that the world’s second-largest economy expanded 6.9 percent in the second quarter, matching the pace from the first three months, was released hours after the Communist Party’s People’s Daily newspaper warned of potential "gray rhinos" -- highly probable, high-impact threats that people should see coming, but often don’t.

China was supposed to be the loser after Moody's Investors Service lowered its rating on Chinese government debt for the first time since 1989, a Bloomberg View reported. The May 24 downgrade to A1 from Aa3 was widely reported as an ominous turn for the world's second-largest economy, whose credit was said to be deteriorating amid borrowing problems and slower growth.

Beijing may currently favour megamergers when it comes to reform of state-owned enterprises, but at least one central bank adviser is suggesting a different approach to dealing with China’s lossmaking zombie companies, the Financial Times reported. In a column published in the Communist party mouthpiece People’s Daily on Thursday, Huang Yiping, a member of the People’s Bank of China monetary policy committee, recommended the creation of a government fund to aid employees who lose their jobs when zombie companies are shuttered.

Swissport is looking to switch up its bonds to avoid being bumped into a default after being bought by China’s HNA Group last year, in a sign of the growing scrutiny on aggressive Chinese acquisition techniques, the Financial Times reported. China’s HNA Group completed its acquisition of Swissport in early 2016, raising debt on its own account to finance the deal, along with high-yield bonds and leveraged loans under Swissport’s name.

China's Jiangsu Shagang Co Ltd said on Monday it is expected to be the biggest shareholder of debt-strapped Dongbei Special Steel Group after a bankruptcy restructuring process, Reuters reported. Owned by the Liaoning provincial government in the country's "rustbelt" northeast, Dongbei entered into the bankruptcy restructuring process in October aimed at recovering a reported $10 billion in debt, and said it faces "uncertainties" about paying interest on medium-term notes in April.

Cosco Shipping Holdings Co. offered $6.3 billion to acquire the container carrier controlled by former Hong Kong Chief Executive Tung Chee-hwa’s family in a deal that would catapult the mainland Chinese group into world’s third-largest shipping line, Bloomberg News reported. State-owned Cosco will pay shareholders of Orient Overseas International Ltd., Hong Kong’s No. 1 box mover, HK$78.67 a share in cash, a 31 percent premium over the stock’s last closing price.

Just as global investors get a new channel to access China’s $9.8 trillion onshore bond market, it’s starting to look like one that they might recognize. Gone are the days when China’s corporate debt was all pretty much priced the same, with an implicit government backstop giving buyers little reason to demand higher returns from some borrowers over others, Bloomberg News reported. Things started changing in 2014, when the Communist Party leadership with little warning began to allow defaults.