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Premier: faster development of privately owned banks

Updated: Nov 19,2014 11:34 PM

Financing is important for real economy

At the executive meeting of the State Council on Nov 19, the government decided to further minimize financing problems of businesses.

Participants spent over an hour discussing how to tackle the issue.

Premier Li Keqiang, who presided over the meeting, said problems remain, though the situation in some areas has improved due to the government’s efforts.

In July, the State Council arranged - during an executive meeting chaired by Premier Li - a series of measures to address the high cost of financing of enterprises.

One participant said that high financing costs mainly concern small- and medium-sized local banks.

The Premier said the authorities should fully implement the ten policies and measures discussed at the meeting.

Li called for efforts to optimize performance assessment of commercial banks and accelerate the development of small- and medium-sized financial institutions, such as privately owned banks.

“The economy might be unable to survive the downward pressure - and risks to the country’s economy may increase - without good finance, which plays a significant role in boosting real economy,” the Premier said.

Assist disadvantaged children

“Children are the future of the nation. Our country’s economic achievements should also benefit them, including those in poverty-stricken areas. This should be part of our efforts to promote a fair society,” Premier Li said at the meeting.

The government decided to work to improve the lives of children in poverty-stricken areas, thus cultivating a better future for the country’s poor children.

The meeting also focused on the possibility of creating subsidy programs for rural residents in poor counties.

However, Li said the funds of such programs would not be used efficiently - even though it may seem like a good and relatively easy solution.

He suggested: “How about the government increasing efforts to identify needy people, thus helping poor families and children?”

The Premier said China’s social security system focuses on meeting the minimum requirements of disadvantaged residents, instead of benefiting the whole population. It targets a certain group of people instead of a certain area.

He asked relevant departments to implement existing measures concerning social security, which would assist poor families.

Li said that China has already explored a new poverty relief model that focuses on individual households instead of the whole village.

“Improving the lives of poor children means that assistance should go directly to poor families. The government should make sure that these limited funds play a bigger role by spending the right way,” he said.

No egalitarianism

The meeting also focused on the draft of the Law of the People’s Republic of China on Promoting the Transformation of Scientific and Technological Achievements.

Premier Li requested relevant departments to make adjustments concerning certain expressions in the draft, so that funds related to the transformation of scientific and technological achievements can be used in a more open and flexible manner.

He said that enterprises and research institutions should no longer rely on egalitarianism, which was part of the country’s past.

“As far as I know, many privately owned S&T enterprises have turned away from equal distribution, which has no future. All other organizations should do the same,” Li said, adding that S&T requires motivated personnel, and employees should have more space and flexibility.

He also requested that a mechanism should be established to encourage S&T staff and promote the transformation of S&T achievements.