China Digest

Economics and policy from China’s newspapers

Wednesday March 22, 2017

Capital must not be ‘sleeping’ in accounts: Premier Li Keqiang

Premier Li Keqiang said “large sums of capital” should not be “sleeping” in the account books, and urged the use of public funds in a “safe and efficient” manner, Xinhua reported on Tuesday evening. Reports last year indicated that as much as 9 billion yuan (US$1.3 billion) of funds had not been used and were “sitting” in the account books of various government agencies, Securities Daily reported in May last year. Li’s remarks might signify an urgency to spend public funds, although no details were mentioned in the Xinhua report.

PBOC urges commercial banks to control housing ratio

The People’s Bank of China (PBOC) issued a notice on Tuesday, urging commercial banks to “reasonably” control the housing loan ratio, or the amount of monthly income a borrower used to service a mortgage, Caixin reported. The PBOC is also looking at “optimizing the credit structure” at banks, the report added. The move comes as the central government fears a housing bubble will follow from recent monetary policies as the central bank has been increasing liquidity in the financial markets recently, the report said.

Two largest nuclear SOEs begin strategic restructuring

The China National Nuclear Corporation (CNNC) and China Nuclear E&C Group (CNEC), the country’s two largest nuclear state-owned enterprises, had started strategic restructuring, the Securities Daily reported on Tuesday morning. Zhang Xiwu, Deputy Director of the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), said it would adopt various methods to restructure SOEs.

Qingdao raises minimum deposit on provident fund loans to 30%

The port city of Qingdao in Shandong province will increase the minimum down payment on provident fund loans from 20% to 30%, Sina Finance reported on Monday evening. The Qingdao Housing Provident Fund Management Center said the rule applies to applicants buying new properties in the city, it added.

More than half of households say property prices are too high

Around 52% of China’s urban households believed property prices were “unacceptably high” in the first quarter of 2017, and 27% were worried they will rise more in the next quarter, Caixin reported on Monday evening, citing data from a People’s Bank of China Survey. Businesses and bankers became more optimistic about the economy, with 65% feeling confident in the first quarter, up from 54% in the preceding three months, it added.