are too low and not to be trusted. Christine Kuo, vice president of Moody's Financial Institutions Group, said while the agency too has its concerns about China's bad loan data, it cannot prove that the numbers are false.
We have our concerns, but we have no evidence, Kuo said.
For state-owned enterprises, the economic slowdown will impact different sectors differently, said Kai Hu, vice president for corporate finance at Moody's.
Strategic sectors such as oil and natural gas production and the power grid will hang onto their monopolies, but consolidation measures recently announced by the government will be a blow to the dominance of state-owned enterprises (SOE) in other sectors.
Overcapacity remains a key obstacle, particularly in cyclical industries, Moody's said in its report, pointing out that capacity utilisation in China had fallen to 60 percent in 2011 from 90 percent in 2000.
We think the economic slowdown will be a challenge for SOE adaptability, Hu said. Growing per capita income will increase cost pressure on companies, he added. Recent market reforms in energy prices will be a boon to suppliers of energy but add cost pressure to consumers.