Chinese Vice Premier urges financial market stability

Source:Global Times Published: 2018/9/10 19:53:39

Committee concludes overall steadiness, vows to fight ‘black swans’

China has vowed to keep financial markets stable and deepen efforts to open up the economy, according to a statement published on the Chinese government's website on Monday.

The statement came after the third meeting by the Financial Stability Development Committee under the State Council, China's cabinet, was held on Friday, when the current economic and financial situation of the country was analyzed.

The committee was set up in November 2017 to oversee China's financial and fiscal policy. After a reform in July, the new committee, headed by Chinese Vice Premier Liu He, has been meeting once a month, with the first and second meetings being held in early July and August, respectively.

The frequent meetings this year are a sign of the committee's increased oversight of China's financial system, Liu Xuezhi, a senior macroeconomics expert at the Bank of Communications, told the Global times on Monday.

"There has been a change in macroeconomic regulation, as control over the economy has become more systematic. Since July, there has been a rising need to respond to risks such as the recent trade tensions or weakening consumption in China," said Liu.

"The committee could possibly keep on meeting every month in order to check on the state of the economy and the implementation status of the reforms," Liu added.

The committee found the current financial situation to be stable overall, citing the deepening of supply-side reform, the stability of employment levels and the increased resilience of microeconomic factors.

In terms of monetary policy, the committee said that the financial system must implement "stable and neutral" policy, ensure fine-tuning according to any circumstantial changes in order to maintain a reasonable level of liquidity in the market, keep stability in the lending, bond and stock markets, and maintain a "reasonably stable" yuan exchange rate. 

The committee also called for increased coordination between regulators, in particular those in charge of financial and fiscal policies. Emphasis was also put on risk-prevention, citing the need to avoid "black swan" events.

The report also mentioned the need to strengthen opening-up reforms, and attached special importance to intellectual property (IP) protection and the growth of private companies and entrepreneurs.

"Opening-up and reforms are making it easier for foreign companies to operate in China and compete. Protecting IP is the next step in these reforms, and will improve the research and development  of domestic companies, giving legal protection to their competitiveness," said Liu.

Newspaper headline: Vice Premier urges financial market stability

Posted in: ECONOMY

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