BEIJING China's outstanding foreign debt fell to $1.42 trillion at the end of 2016 from $1.43 trillion at the end of September, the foreign exchange regulator said on Friday.
Short-term foreign debt stood at $870.9 billion at end-2016, down from $894.4 billion at the end of the third quarter, the regulator said.
At the end of 2016, China's outstanding foreign debt was 13 percent of GDP and its short-term foreign debt was 29 percent of FX reserves, the State Administration of Foreign Exchange (SAFE) said in a separate statement on its website.
"China's foreign debt risks fall within internationally recognized boundaries. Overall China's foreign debt risks are manageable," SAFE said.
"Companies need to be able to borrow a reasonable amount of debt to go about their daily operations," SAFE said, adding that Chinese companies would independently decide when, how much and in what currency to borrow.
Short-term foreign debt accounted for 61 percent of the total at the end of last year, while medium- and long-term debt made up 39 percent of the total, SAFE said in a statement on its website.
Yuan-denominated foreign debt made up 34 percent of total foreign debt at the end of 2016, compared with 40 percent at the end of September.
The yuan CNY=CFXS fell 6.5 percent against a surging dollar in 2016, its biggest annual drop since 1994.
China's foreign debt deleveraging process had basically finished and the size of China's foreign debt would steadily rise in 2017, the regulator said in a note accompanying the statement.
(Reporting by the Beijing Monitoring Desk, Sue-Lin Wong and Kevin Yao; Editing by Nick Macfie)