Chinese companies have been piling on debt for at least a decade, ever since the leadership team under Xi’s predecessor responded to the 2008 global financial crisis by going on a borrowing binge. That kept China’s economy chugging, but at a cost. The corporate debt to GDP ratio surged to a record 160% at the end of 2017, from 101% 10 years earlier. Xi and his lieutenants vowed to rein it in, issuing directives on how money was to be loaned and managed. A particular goal has been to curb China’s $10 trillion ecosystem of shadow banking. So-called local government financing vehicles, which were established to fund infrastructure projects, have already defaulted on many trust loans that were part of that shadow system. None have defaulted on a public bond, but an LGFV defaulted this year on 915 million yuan worth of commercial bills. So-called hidden debt at local levels was raised to a national security issue at the annual legislative gathering in Beijing in March.