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Chinese Universities Face Pressure to Cut Their Debts

October 18, 2011, 1:18 pm

China’s provincial governments, pushing universities to repay their debts and cut borrowing, have ordered them to stop construction projects in some parts of the country, reports China Daily. The cutbacks come amid a wider credit crunch as the governments face pressure to tidy up their own bloated debts, built up as part of a national economic-stimulus effort after the 2008 global financial crisis. Universities in Anhui province will not be allowed to build new dormitories if they already have sufficient space for students, or to borrow more money without government approval, said Yang Delin, deputy director of the province’s education department. In nearby Hubei province, universities have been urged to pay back loans totaling $2.08-billion in the next five to eight years.

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