Headlines

A Canadian court on Monday upheld a decision to grant lenders priority over environmental clean-up costs in oil-and-gas bankruptcies, raising chances disused wells from defunct companies could become a government responsibility, Reuters reported. That could further strain the government-run, industry-funded Orphan Well Association (OWA), which cleans up wells for which no party is legally responsible. The group has said it needs extra funding and upping levies for producers is an option.

Former Finance Minister Lou Jiwei said China should allow smaller local governments to default on debt because it would signal that central government bailouts aren’t assured, Bloomberg News reported. Such defaults would educate investors that their investments will be allowed to go bad, Lou said Friday at a public finance forum in Beijing. "They need to shoulder responsibility," said Lou, who’s now chairman of the country’s social security fund.

An Ontario appeal court has rejected an attempt by United Steelworkers Local 2724 to overturn two orders made by Justice Frank Newbould in the Essar Steel Algoma restructuring proceedings, Sootoday.com reported. Local 2724, representing Essar Algoma's salaried employees, was trying to appeal decisions made by Judge Newbould on Dec. 22 and 29, 2016. On Dec. 22, Newbould had ordered that a term sheet summarizing the terms and conditions of an agreement between Essar Algoma and Cliffs Mining Co. be disclosed to the union's financial advisor, subject to a non-disclosure agreement. On Dec.

As the International Monetary Fund approaches the seventh anniversary of the contentious Greek bailout, it is torn over whether to commit new loans to a nearly bankrupt Greece, the International New York Times reported. For more than a year, I.M.F. officials have been saying — loudly — that they cannot participate in a new rescue package for Greece unless Europe agrees to ease Greece’s onerous debt burden. The fund’s reluctance to commit additional money to Greece also highlights a widely held view among I.M.F.

Ratings agency S&P has downgraded El Salvador’s sovereign credit rating to “selective default” after the government missed payments related to its pension debts, the Financial Times reported. The government missed $28.8m worth of payments due between April 7 and April 10 after the country’s Congress failed to approve a budgetary allocation to cover the payments. Assuming a solution is not found, the total owed is set to rise to $55.2m by the end of this month.

Malaysia has reached an agreement to pay Abu Dhabi $2.5 billion as partial debt settlement for embattled government fund 1Malaysia Development Bhd., according to a person familiar with the matter. Under a deal that’s expected to be announced Monday on the London Stock Exchange, Malaysia will pay Abu Dhabi $1.2 billion before the end of this year, said the person, who asked not to be identified as the information isn’t yet public, Bloomberg News reported.

Saudi Arabia’s King Salman has reinstated allowances and bonuses for state employees as its finances improve, a move aimed at boosting consumer confidence to support growth as the kingdom overhauls its oil-dependent economy, The Wall Street Journal reported. In a spate of decrees issued late on Saturday, the king also appointed one of his sons, Prince Abdulaziz bin Salman, as the minister of state for energy, industry and mineral resources. Another of his sons, Prince Khaled bin Salman, was named ambassador to the U.S., according to the official Saudi Press Agency.

Greece achieved a 2016 primary surplus almost seven times higher than its bailout target, but the International Monetary Fund is skeptical the country can sustain that performance, Bloomberg News reported. The Hellenic Statistical Authority is set on Friday to unveil data on last year’s primary surplus, which Eurostat is expected to validate on Monday. The surplus will be close to 4 percent of gross domestic product, according to a finance ministry official who asked not to be identified in line with policy. The bailout target was for a primary surplus of 0.5 percent of GDP.

In Italy, the banks, according to the European Central Bank, are saddled with $385 billion of non-performing loans, which is one-third of the euro zone’s total. Three banks in Italy, including Monte dei Paschi, the world’s oldest bank, are struggling to survive, and the government is in a battle royal with the EU and the ECB concerning their restructuring, a Bloomberg View reported. Italy has set up several bad bank funds, but they are woefully inadequate to confront the real losses that have taken place.

China is engaged in a charm offensive to lure foreign money into its bond market, which has grown in a short period of time from a minnow to the third largest in the world, after the US and Japan, the Financial Times reported. The opening of the bond market to foreigners is part of a transformation in the international financial system, which is slowly linking up with a Chinese economy that was once walled off behind tight capital controls. It is a crucial step in Beijing’s plan to turn the renminbi into one of the anchor currencies of the global economy.