In Depth: Risks Are Building Up in China’s Internal Finance Companies

At last year’s World Financial Forum, Sun Hengchao, chairman and controlling shareholder of Baota Petrochemical Group Co. Ltd., lamented how hard it was for private companies to get financing in China.

If a company never borrows, its ability to increase its market share will be limited, but if it borrows too much, that can lead to other risks, Sun told Caixin in an interview at the annual event in Davos, Switzerland. He noted that this situation calls for management to make wise decisions and maintain a proper debt ratio as a company grows.