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Last updated at: (Beijing Time) Thursday, December 05, 2002

Central Bank Supports Capital Market Development

China's central bank will actively support the development of a capital market, said Dai Xianglong, governor of the People's Bank of China (PBOC) on Wednesday.


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China's central bank will actively support the development of a capital market, said Dai Xianglong, governor of the People's Bank of China (PBOC) on Wednesday.

At the opening ceremony of The China Conference: The Year of Capital held here Wednesday, Dai said that efforts would be made to further improve domestic financial markets, especially the development of the capital market.

He said China would further deepen its reforms of the financialsystem and improve financial services.

Over the next few years, he said, attention would focus on the competitiveness of the banking industry, state-owned commercial banks are expected to be transformed into modern, internationally-competitive financial enterprises by 2006.

The rate of non-performing loans would be lowered by two to three percentage points annually, and state-owned commercial bankswould become share-holding commercial banks controlled by the state and, if qualified, listed for public trading, he said, adding that private and foreign capital would be introduced to medium-sized and small banks.

Efforts would also be made to improve monetary policies, so as to create a good macro environment for national economic development. The goal of China's monetary policy was to maintain the value and stability of the Renminbi and the key to China's monetary policies in the next few years would be preventing deflation.

The central bank would continue to improve supervision, ward off financial risks, protect the interests of depositors, investors and tax payers, as well as the state's financial safety.

He said that the RMB convertibility would be carried out in a steady and progressive way. With its accession to the World Trade Organization, China had entered a new stage in using foreign capital. This year foreign direct investment is expected to reach 55 billion US dollars. China had allowed qualified foreign institutional investors to invest in the domestic capital market, and policies concerning overseas investment by qualified domestic institutional investors were being studied.




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