New swap to help firms

China will encourage private and foreign investors to take part in debt-to-equity swaps in a bid to help ease companies’ debt burdens and boost their vitality, the State Council decided at an executive meeting on May 22.

According to a statement released after the meeting, chaired by Premier Li Keqiang, a proper pricing mechanism for the swaps will be set up. Social capital will be encouraged to take part in market-oriented swaps to improve equity structures, with the protection for the rights and interests of private investors set to be enhanced.

Foreign investment will be encouraged to acquire stakes in the implementing agencies for the swaps.

More support will be extended to financial-asset investment firms in launching asset management products and accepting investment from insurance and pension funds. Publicly offered asset management products will be allowed to participate in the swap in keeping with related laws and regulations, the statement said.

The meeting also called for improvements in the mechanism of exempting liability in cases of due diligence in State-owned enterprises and implementing agencies. New approaches to pursue swaps will also be developed, and the pilot program of debt-to-preferred stocks swap will be expanded.

Quality companies with a high-leverage ratio as well as qualified business segments will be prioritized in the debt-to-equity swap, the statement said.

Participants at the meeting also agreed to adopt multi-pronged measures to help financial asset investment firms involved in the swap programs to replenish their capital.

The meeting also greenlighted eligible trading floors to trade assets in the swap deals to ensure that financial-asset investment firms play an important role in the debt-to-equity swap process.

Workers get skills upgrade

The State Council issued a three-year action plan on May 24 to upgrade workforce skills with training sessions offered to migrant workers, veteran soldiers and the unemployed.

The country will offer subsidies to open 50 million upgrading sessions to its workforce between 2019 and 2021.

It has also set a target of increasing the percentage of skilled workers to more than 25 percent of the total workforce by 2021, with high-skill workers taking up at least 30 percent of all skilled workers.

The plan will also prioritize training to key groups, including families living below the poverty line, with incentives offered to businesses to bolster training of their workers.

The government will encourage enterprises to establish vocational training centers and promote the development of these centers between vocational schools and businesses, the plan said.

The plan also called for more funding support for the training of workers as local authorities are required to coordinate their funding for vocational training purposes.