{"id":557025,"date":"2026-04-29T14:05:14","date_gmt":"2026-04-29T14:05:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/557025\/"},"modified":"2026-04-29T14:05:14","modified_gmt":"2026-04-29T14:05:14","slug":"china-targets-zombies-with-regulatory-headshots-to-kill-off-subsidised-laggards","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/557025\/","title":{"rendered":"China targets \u2018zombies\u2019 with regulatory headshots to kill off subsidised laggards"},"content":{"rendered":"

China\u2019s top market regulator is intensifying its crackdown on debt-laden \u201czombie companies\u201d \u2013 rolling out a pilot programme in seven economic hubs to facilitate the forced exit of unprofitable firms often propped up by government subsidies or bank loans.<\/p>\n

The move signals a broadening of Beijing\u2019s campaign against local protectionism and the low-quality vicious competition that officials say results in neijuan, or \u201cinvolution\u201d<\/a>.<\/p>\n

With a change to China\u2019s Company Law, the State Administration for Market Regulation and relevant departments can now petition courts for the compulsory liquidation of these walking-dead entities if they fail to voluntarily wind up.<\/p>\n

The pilot programme will initially focus on Beijing city and the provinces of Hebei, Jiangsu, Zhejiang, Henan, Sichuan and Guangdong, the regulator announced on Monday.<\/p>\n

The initiative is a positive development, said Alicia Garcia-Herrero, chief economist for the Asia-Pacific region at French investment bank Natixis.<\/p>\n

\u201cI expect it to be moderately effective for clearing smaller, dormant private firms in the pilot areas and improving market-exit mechanisms,\u201d she said. \u201cHowever, its broader impact on China\u2019s zombie-company problem is likely to be limited in the short term, as many larger or state-linked zombies continue to be supported by local governments and banks.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"China\u2019s top market regulator is intensifying its crackdown on debt-laden \u201czombie companies\u201d \u2013 rolling out a pilot programme…\n","protected":false},"author":2,"featured_media":557026,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[1296,5713,191304,84,891,1294,1974,191303,16788,10427,55664,94183,10421,27965,85411,15244,56,54,55,24662],"class_list":["post-557025","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-asia-pacific","tag-beijing","tag-bruegel","tag-business","tag-china","tag-economy","tag-european","tag-federal-reserve-bank-of-dallas","tag-french","tag-guangdong","tag-hebei","tag-henan","tag-jiangsu","tag-natixis","tag-sichuan","tag-state-administration-for-market-regulation","tag-uk","tag-united-kingdom","tag-unitedkingdom","tag-zhejiang"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/557025","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=557025"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/557025\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/557026"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=557025"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=557025"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=557025"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}