29.48 trillion yuan, this is the latest accounts receivable figure for industrial enterprises above a designated size for August, recently released by the National Bureau of Statistics, marking a historic high.
Payment delinquencies and collection difficulties have become widespread across numerous industries. Behind these tens of trillions of yuan in accounts receivable lies a survival crisis for businesses. Moreover, these arrears trap many enterprises within a chain of debt, leaving them with no funds to invest and no courage to invest, thereby suppressing private investment confidence.
Since the beginning of this year, a series of policy measures have been introduced by targeting the three primary sources of arrears: local governments, centrally administered and state-owned enterprises, and leading supply chain corporations. Addressing the current chain-like nature of debt—characterised by “governments owing state enterprises, state enterprises owing private firms, and large corporations owing small businesses,” alongside complex, interwoven layers of defaults—the Chinese government has proposed an approach to break through these links via an interlocked clearance strategy.
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