浙侨英频 Financial sector urged to shun potential risks

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A clerk counts cash at a bank outlet in Hai'an county, Jiangsu province. [PhotoChina Daily]

Vice-premier calls on system to better serve real economy, support small firms

China's financial sector should further strive to cement economic growth and fend off potential risks while seeking high-level opening-up and creating a level playing field for global investors, officials and analysts said on Wednesday.

In a written speech distributed on Wednesday at the opening ceremony of the 2021 Annual Conference of Financial Street Forum, which runs through Friday in Beijing, Vice-Premier Liu He stressed that the country's financial system should be more proactive in serving the real economy and effectively adjust monetary policy, especially to support the financing of the private economy and small and micro enterprises.

Liu, who is also a member of the Political Bureau of the Communist Party of China Central Committee, highlighted the financial system's role in continuously supporting high-level opening-up and creating a fair market environment. The legitimate rights and interests of foreign-funded institutions in China should be protected, he said.

Liu also said that the financial sector should support green and low-carbon development, strengthen regulation of financial technology and prevent risks.

Although there are some problems in the real estate market, these risks are generally under control. The overall trend of the healthy development of the real estate market will not change, he said.

Earlier this month, Yi Gang, governor of the People's Bank of China, the nation's central bank, answered questions at the 2021 G30 International Banking Seminar about whether the default risk of China's largest private real estate developer Evergrande could result in systemic risk. Yi said the spillover of Evergrande's risks to the financial sector was under control.

We are confident that we can prevent the risk from spreading and avoid systemic risk, Yi said at that meeting, after saying that Evergrande's liabilities totaled about $300 billion and only one third of them are to the financial sector.

Yi also pledged to solve this isolated case in accordance with laws, give higher priority to homebuyers' rights and treat all creditors and related parties equally under the law.

Pan Gongsheng, vice-governor of the central bank and head of the State Administration of Foreign Exchange, said at Wednesday's forum that China's real estate market and related financial markets showed some fluctuations, which is the response of market entities after individual enterprises' default cases.

Due to the financial regulators' guidance of the expectation, the excessive rising of the risk appetite of financial institutions and the market has gradually been reversed, while financing behavior and prices in financial markets are gradually returning to normal, Pan said.

China's real estate sector is also faring better than expected, said David Chao, global market strategist for Asia Pacific at Invesco. It is likely that the government will orchestrate a managed slowdown for the sector and that the contagion risks may be kept at bay.

The authorities are likely to outline additional monetary and fiscal supportive measures next month to counter weak demand and prevent property sector risks. There could be a cut to the reserve requirement ratio and a ramping up of local government infrastructure spending over the next quarter, Chao said.

It is possible we will see a small policy shift over the next month as policymakers clear more fiscal space for a rebound in infrastructure spending.

According to Yi Huiman, chairman of the China Securities Regulatory Commission, market-oriented methods will be adopted to mitigate bond default risks, such as asset sales, debt restructuring and the introduction of strategic investment by bond issuers and relevant parties.

The exchange bond market is generally stable nowadays, and the number of default cases remains at a low level accounting for about only 1 percent. But we still face many risks and challenges, Yi said.

【背景阅读】

刘鹤向2021金融街论坛年会开幕式致辞

2021金融街论坛年会10月20日在京开幕。中共中央政治局委员、国务院副总理刘鹤作书面致辞。中共中央政治局委员、北京市委书记蔡奇出席开幕式并致辞。

刘鹤表示，今年以来，面对多重风险冲击，在以习近平同志为核心的党中央坚强领导下，我们有效实施宏观政策，国民经济稳定复苏，金融系统发挥着关键作用，取得了积极成效。

刘鹤指出，中国是具有强劲韧性的超大型经济体。在党中央、国务院的坚强领导下，这种韧性来自市场主体竞争力，来自经济结构的完整性，来自改革开放的正确政策，更来自超大规模的国内市场和亿万人民通过艰苦奋斗实现美好生活的不懈追求。

刘鹤强调，金融系统要进一步主动担当作为。更好服务实体经济，做好货币政策调节，加大对民营经济、小微企业等的融资支持。支持绿色低碳发展，支持煤的清洁高效利用与新能源的开发利用，保障能源安全，推动实现“双碳”目标。推进高水平对外开放，创造公平市场环境，保护在华外资机构合法权益。更加重视金融科技，提升金融服务质效，加强科技监管能力建设。统筹做好金融风险防控，实现防风险和稳发展的动态平衡。目前房地产市场出现了个别问题，但风险总体可控，合理的资金需求正在得到满足，房地产市场健康发展的整体态势不会改变。

来源 新华社