- Wednesday, October 16, 2024
The regulators have highlighted their goal to increase the share of loans given to private companies as a proportion of total lending. They believe that overall financial support to the private sector should align with its contribution to China's economy. In addition, private companies, including platform businesses, will be encouraged to list overseas and will be granted improved access to funding through the issuance of bonds and equities.
People's Bank of China Governor Pan Gongsheng has indicated that the central bank will maintain reasonably adequate liquidity in the future, with a focus on channeling more financial resources into smaller private companies. This move aims to address the challenges faced by these companies and ensure their growth and development.
The recent meeting of financial regulators included representatives from the central bank, top foreign exchange and securities regulators, and the newly-established National Administration of Financial Regulation. State media reported that attendees also included representatives from major state lenders and private companies.
While Beijing has implemented various supportive measures in recent months to bolster the struggling private sector, no significant stimulus plans have been announced. This raises concerns among economists as economic pressures continue to mount. Investment by private companies experienced a decline of 0.5% in the first seven months of this year, exacerbating the 0.2% decline recorded in the January-June period.
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