Serious "triangular debt" problem in instrumentation industry

Yan Zengxuan, secretary general of the China Instrument and Instrument Association, said on August 16 that at the current stage, the “triangular debt” problem in the instrumentation industry is more serious, and some small and medium-sized enterprises have a higher proportion of accounts receivable.

Yan Zeng said that the main reason for the “triangular debt” problem is that companies in the instrument and meter industry are relatively small, and they cannot cope with the upstream and downstream companies. If the company does not have scale and capital advantages for the upstream suppliers, the downstream companies can’t repay the funds in arrears. Therefore, the capital chain of instrument and meter companies will be very tight. Because the added value of the instrumentation industry is relatively high, the cash flow of most companies can balance the "triangular debt" problem, but SMEs are incapable of dealing with this issue.

Yan Zengxuan hopes that on this issue, instrument and meter companies can pay more attention to ensure the smooth flow of cash flow and take measures to actively face the problem.

The narrowly defined "triangle debt" refers to a closed debt chain formed by the arrears of payments among three or more companies. The broad "triangular debt" refers to the arrears that exceed the collection commitment period or agreed payment period between enterprises. .