BEIJING — China will continue its efforts to reduce the corporate leverage ratio this year to effectively control macro leverage and rein in financial risks, the top economic planner said on Aug 8.

A mechanism to prevent and control corporate debt risks will be established, and the monitoring and early warning mechanism of corporate debt risks will be improved, according to a guideline on reducing corporate leverage in 2018, released by five central departments including the National Development and Reform Commission.

Debt-to-equity swap projects will be advanced in a market-oriented and law-based manner, and the financing channels of institutions will be widened, according to the guideline.

Disposal of loss-making zombie companies’ debt will be accelerated, with improved policies for debt disposal and perfected system for law-based bankruptcy by removing barriers obstructing bankruptcy according to law, while merger and restructuring of companies will be actively promoted, said the guideline.

China has made steady progress in deleveraging, and the country’s leverage ratio has been gradually lowered.

Since 2017, the growth of China’s leverage ratio has slowed down substantially. The leverage ratio in 2017 was 2.4 percentage points higher than in 2016. The growth was 10.9 percentage points lower than the average annual growth rate from 2012 to 2016, data showed.