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China news tagged with: financial policies (41)

• Diet Risks at a Government Finance Feast

  

  From Caijing Magazine:

  Financial crisis? What financial crisis? Local governments across China simply can’t fathom the fuss. They’re not starved of credit. In fact, they’re enjoying a veritable financing feast.

  Figurative chopsticks are digging deep into financing platforms offered by investment companies created by and operating inside local government offices, from city finance bureaus to local branches of the National Development and Reform Commission (NDRC).

  These days, a single city hall may be sponsoring several financing platforms at once, perhaps one for construction projects and another for alternative energy programs. Investment vehicles are also doing business at provincial and township government levels.

  » Read more
  • June 14, 2009 11:16 PM

• China to Ease Securities Tie-up Rules – Geoff Dyer

  

  From FT.com:

  China is planning to introduce rules by the end of the year to allow a handful of foreign investment banks to invest in joint ventures with local securities firms, according to senior government officials and banking executives.

  …Under the revised rules, foreign investment banks would be allowed to own up to 33 per cent of a new securities industry joint venture with a local partner, officials said…..[Full Text]

  » Read more
  • September 23, 2007 10:17 AM

• China’s Inflation Policy Stirs The World – Thomas Palley

  

  From Asia Times:

  China’s government recently announced that inflation hit a 10-year high of 6.5% in August. This increase in inflation is directly related to global trade imbalances, yet China is trying to control inflation without addressing that problem.

  That carries two consequences. First, it is doubtful this strategy can work, which likely signals rising Chinese inflation. Second, the strategy aims to shift the onus of global trade adjustment on to the United States, which may come back to haunt China and the global economy.

  China’s current inflation is a textbook case of prolonged undervaluation of a fixed exchange rate in tandem with export-led growth. As such, significant exchange rate revaluation should be a central element of its anti-inflation policy. [Full Text]

  Thomas Palley is a former chief economist of the US-China Economic and Security Review Commission.

  » Read more
  • September 22, 2007 8:46 AM

• China’s Rate Increase Targets Food Prices – Jamil Anderlini

  

  From Financial Times:

  China’s central bank raised interest rates for the second time in less than a month on Friday in an attempt to rein in soaring food prices, excessive bank lending and bubbles in the property and stock markets.

  The People’s Bank of China lifted the one-year benchmark deposit rate by 27 basis points to 3.87 per cent and the one-year lending rate by the same amount to 7.29 per cent, effective immediately.

  The PBOC has now lifted rates five times this year as it strives to contain headline inflation that reached 6.5 per cent in August, the fastest increase in more than a decade. [Full Text]

  » Read more
  • September 15, 2007 5:21 AM

• No Threat Of Foreign Monopoly In Any Industry – Report – Jiang Wei

  

  From China Daily:

  The country does not face an imminent risk of monopoly by foreign companies in any industry, according to the China Foreign Investment Report 2007 released by the Ministry of Commerce.

  Wang Zhile, director of the Multinational Enterprise Research Centre affiliated to the Ministry of Commerce, made the observation in an essay for the report in response to people’s rising concerns about possible foreign monopolies in the country.

  He explained that although foreign investors do have a large market share in certain industries, it does not necessarily mean monopolies. [Full Text]

  Read also Ministry: Overseas-funded Companies Top 610,000 In China, Financial Policy Changes To Back Outbound Investment and Chinese Enterprises Arise As Popular Investors On Global Market by Xinhua.

  » Read more
  • September 10, 2007 2:19 AM

• Beijing to Set Out Finance Reform at Party Conclave – Richard McGregor

  

  From Financial Times:

  China will set its priorities for finance reform for the next five years at a top-level party conclave next week expected to focus on rural banking and an enhanced role for the country’s largest financial holding company.

  The so-called finance work committee meeting, to be chaired by Wen Jiabao, the premier, has been held twice before – in 1997 and 2002 – and in both cases resulted in substantial and far-reaching policy changes.

  The government has so far not announced the existence of the closed-door meeting, let alone its date or agenda, but has consulted extensively in recent months with local economists and scholars about the issues to be tackled.[Full Text]

  » Read more
  • January 12, 2007 8:17 AM

• China to Maintain `Stable Currency Policy’ in 2007, Zhou Says – Wing-Gar Cheng and Ying Lou

  

  From Bloomberg:
  
  

  China’s central bank, under pressure from the U.S. and other Group of Seven nations to make the yuan more flexible, will in 2007 pursue a “stable currency policy” to promote economic growth.

  The People’s Bank of China “will continue to strengthen and adjust financial control mechanisms, execute a stable currency policy, improve foreign exchange management and push for financial reforms and innovation,” Governor Zhou Xiaochuan said today. “We want to contribute to ensure stable and accelerated economic development.”

  Zhou, who met with U.S. Treasury Secretary Henry Paulson in Beijing this month for the inaugural so-called Strategic Economic Dialogue between China and the U.S., has said he wants to increase the flexibility of the yuan at a “gradual” pace. U.S. lawmakers, who claim China unfairly keeps its currency undervalued to stoke exports, are keen for Zhou to move faster. [Full Text]

  (Photot of Zhou Xiaochuan)

  » Read more
  • December 30, 2006 8:19 PM

• Report on China Is Notably Softer on Currency Valuation – Steven Weisman

  

  
  From The New York Times:

  The Bush administration, softening its tone of criticism toward China, reported to Congress on Tuesday that the Chinese had made strides in revaluing their currency, but that the progress was “considerably less than is needed.”

  The muted tone, in contrast with a finding more than six months ago, came in a report that is required twice a year. It was issued four days after a trip to China by Treasury Secretary Henry M. Paulson Jr. and six other Cabinet-level officials. And it appeared to reflect Mr. Paulson’s preference for quiet persuasion over confrontation.

  The administration has called on China to open its economy further, crack down on product piracy and let the value of its currency, the yuan, rise. Many economists contend that the Chinese have deliberately undervalued the yuan to promote exports. A low value for China’s currency makes its exports relatively cheap in the West and its imports more expensive. [Full Text]

  » Read more
  • December 19, 2006 10:45 PM

• Act your age, Beijing – Guardian Unlimited

  

  From Guardian Unlimited:

  It is hardly a surprise that the large American economic delegation to China has returned with little to show.

  Even at the final press conference, while the US treasury secretary, Henry Paulson, said China would make its currency more flexible but gave no timetable; the Chinese deputy prime minister, Wu Yi, did not indicate that such an agreement was reached.

  China is proud of its size and age, and it does not like foreigners demanding concessions and prefacing sarcasm in their remarks, which resemble lectures. Giving lectures in China, Chinese leaders think, is a Chinese prerogative. But such apparent cultural sensitivity apart, this does not make the Chinese right….[Full Text]

  (photo: A bank teller counts Chinese yuan notes at a branch of the China Merchants Bank in Beijing. Photograph: Michael Reynolds/EPA)

  » Read more
  • December 18, 2006 8:06 PM

• China Unveils Rules For Foreign Banks – Reuters

  

  From Reuters:

  China on Wednesday released rules governing the operations of foreign banks once the country fully opens its doors to them in line with its WTO commitments.

  In a document released by the official Xinhua news agency, China said foreign-funded banks and joint-venture lenders needed to set aside at least 1 billion yuan ($127 million) in registered capital.

  By doing so, they would be allowed to do “part of or all” foreign currency and yuan-denominated business, it said.[Full Text]

  -Read the report from the Financial Times, China paves way for foreign banks
  -Also read the story from Xinhua

  » Read more
  • November 15, 2006 12:28 PM

• China’s Forex Reserves Exceed $1,000 Billion – Peter Garnham

  

  From Financial Times:

  China’s foreign currency reserves have exceeded $1,000bn for the first time, according to reports yesterday on the country’s state television network.

  The announcement had been expected since China’s State Administration of Foreign Exchange announced last month that its reserves hit $987.9bn at the end of September.

  China’s forex reserves became the largest in the world this year when they overtook those of Japan, which stood at $881bn at the end of September.[Full Text]

  -Also read CDT post China confirms it holds around 70% of its reserves of dollars.

  » Read more
  • November 7, 2006 10:31 AM

• 5 Years After China Entered WTO, Bumpy Road to Banking Freedom – Melissa Thomas

  

  From Financial Times:

  December 11 is the fifth anniversary of China’s entry into the World Trade Organisation and the deadline for Beijing to fulfil its final commitments. These include opening up retail banking to foreign banks for the first time. In preparation, the China Banking Regulatory Commission (CBRC) in August circulated draft Administrative Measures for Foreign-Funded Banks for comment. The measures are expected to be issued in November with only minor modifications.

  Since WTO accession, international banks have been permitted to grow their Chinese branch networks, compete for the business of foreign-invested companies and establish niches offering new services to domestic companies. But the scale of their business remains tiny compared with China’s state-owned commercial banks, now cash-rich from initial public offerings. International banks poised to apply for local retail licences are therefore anxious to know whether these measures will offer a level playing field or create a new set of hoops to jump through.

  The answer is probably both. Most foreign banks carry their Chinese business directly through branches rather than locally incorporated subsidiaries. It is now clear that only subsidiaries, termed foreign-funded banks, will be licensed to offer full retail services. Foreign-funded banks will have to comply with the same capitalisation requirements as domestic banks: registered capital of Rmb1bn ($127m) and operating capital of Rmb100m per branch.[Full Text]

  » Read more
  • October 24, 2006 9:22 PM

• China should marshal its reserves to do good – Jeffrey Garten

  

  From Financial Times:

  Any day now, China’s foreign exchange reserves will reach the $1,000bn mark. That is one-fifth of the world’s re¬≠serves, an amount greater than Japan’s enormous holdings and more than the reserves of Germany, France, Italy and Canada combined. China’s cushion of cash and investments would finance more than a year’s worth of the country’s imports, exceeding the margin of safety that any great trading nation needs, while still providing insurance for other emergencies. Beijing’s reserves have been growing in recent years by about $200bn a year; at that rate China will be nearing the $2,000bn milestone by the end of this decade.

  This cornucopia is not an unalloyed blessing. It will complicate the country’s ability to contain inflation. If the greenback continues to depreciate, the value of China’s vast dollar holdings would decline. As reserves build, charges of predatory mercantilism from Europe and the US could reach a feverish pitch, leading to serious trade wars.[Full Text]

  -Read The New York Times editorial about China’s record foreign exchange reserves China’s Milestone, Our Millstone

  -Also read another commentary from Financial Times on China’s financial system: Scepticism needed in China’s banking frenzy

  » Read more
  • October 22, 2006 6:32 PM

• China’s Reserves Near $1 Trillion – WSJ

  

  As China’s foreign-exchange reserves and money supply growth continue to increase, pressures on interest rates and exchange rates are mounting. Read the story from The Wall Street Journal:

  China’s foreign-exchange reserves, the world’s largest, rose to just below $1 trillion at the end of September, while money-supply growth eased, according to data issued Friday.

  As China continues to record large trade surpluses, analysts expect that foreign-exchange reserves will remain on a strong upward trend. At the same time, money-supply growth, while slightly slower than in the previous month, remains above the central bank’s target.

  China’s foreign-exchange reserves totaled $987.9 billion at the end of last month, up 28.5% from a year earlier, the People’s Bank of China said.

  The country’s broadest measure of money supply, M2, was up 16.8% from a year earlier at the end of September, the slowest growth rate so far this year, although still above the central bank’s full-year target of a 16% rise.[Full Text and Subscribers Only]

  » Read more
  • October 15, 2006 9:45 PM

• Morgan Stanley Becomes the First Foreign Bank Doing Renminbi Business in China

  

  Morgan Stanley will become the first foreign bank being allowed to do renminbi business in China, Financial Times reported.

  In order to protect local banks from foreign banks, which are usually much more competitive and market-oriented, Chinese monetary authorities banned foreign banks from offering renminbi-denominated products.

  Morgan Stanley will be qualified to apply for a license of renminbi business after it acquired Nan Tung Bank, one of the few Chinese banks open to foreign ownership, the newspaper said.

  Click HERE to read the news story.

  Morgan Stanley is on Monday expected to announce that it has obtained a coveted Chinese commercial banking licence, a surprise move that trumps its US investment bank rivals.

  The licence will pave the way for it to offer renminbi-denominated products to corporations operating on the mainland. Typically, overseas banks have to operate for at least five years on the mainland, clear tough regulatory hurdles and obtain a commercial banking licence before being able to apply to conduct business in local currency.

  » Read more
  • October 1, 2006 8:14 PM

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