China's debt has been rising rapidly, but risks are controllable, officials said on Thursday.
China's total debt ratio is at a medium level among the world's major economies, said Sun Xuegong, deputy head of the National Development and Reform Commission's (NDRC) department of finance, at a briefing.
The leverage ratio of China's non-financial sectors and total debt ratio remain between 200 percent and 300 percent, Sun said citing the Bank for International Settlements and the Chinese Academy of Social Sciences.
"It is a fact that China's debt load has been expanding relatively fast in recent years, and the leverage ratio of non-financial companies is particularly high," said Sun, describing the phenomenon as "growing pains" caused by the country's specific development stage.
While acknowledging the high debt level has had a bad effect on businesses and the financial sector, raising companies' financial cost and the risks of debt default, Sun said the risks are generally controllable, but future risk cannot be neglected.
At the briefing, an official with the Ministry of Finance (MOF) disclosed China's government debt levels.
By the end of 2015, government debt stood at 26.66 trillion yuan (about 4 trillion U.S. dollars), accounting for 39.4 percent of GDP, said Wang Kebing, deputy head of the MOF budget department, at the briefing.
When outstanding debt of local government finance platforms is included, the ratio reached 41.5 percent of GDP, Wang said.
This is lower than the 60-percent warning line set by the European Union and much lower than major developed economies and emerging economies, Wang said.
This means, on the whole, there is still some room for the Chinese government to borrow, Wang added.
On bad loans, Sun said, given the ample provision and sound balance sheets of commercial banks, corporate debt risks will not to shake the stability of the financial system, the banking system in particular.
