Government opens more financing channels
By Fu Jing (China Daily)
Updated: 2004-07-29 00:25

All enterprises will get the green light to channel capital through a share-holding system, a senior economic official said Wednesday in Beijing.

The official regarded the measure as a way for China to multiply financing channels for enterprises.

Jiang Weixin, vice-minister of the National Development and Reform Commission, said China will take an active but cautious approach to set up a sound capital market.

"All of our financing system reforms will be market-oriented in the long run, but it is really a demanding job," said Jiang.

Jiang expressed the commitment at Wednesday's press conference organized by the State Council Information Office to reveal China's reform on investment system.

Jiang said enterprises, banks and the government will play different, and more independent roles after this round of investment reforms.

"Especially for banks, they themselves will have a decisive say on whether they will lend money," said Jiang.

In the past, the government would be heavily engaged in bank loaning. That created lingering problems that still trouble the financial sector, mainly bad loans burdening State-owned commercial banks, rising financial fraud and scams, and the poor quality of stock market-listed firms.

"So we will multiply financing channels, and enterprises can get capital not only through bank loans, but also from the stock and debt market," said Jiang.

Jiang said that all of the government's recent economic measures are aimed at helping the economy achieve health and rapid growth.

Earlier this month, Premier Wen Jiabao warned problems still exist in the operation of China's economy despite its overall healthy development.

He singled out areas of concern including an overabundance of fixed assets investment, an imbalanced investment structure and tight supply of coal, electricity and oil, and the country's transportation capability.

This week, Wen said the non-public economy is a very important component of China's socialist market economy.

Private investors can put their money into any sector not forbidden by laws.

And on Tuesday, the government issued an updated investment guideline for foreigners and encouraged them to start their businesses in western and central China. Mineral resources exploration, agricultural development, and the service industry are investment priorities listed by the government.

"All these measures are aimed to further invigorate China's economy," said Jiang.

Jiang said more measures will be taken to realize the so-called "circular economy" and make its development environment-friendly.The concept is ultimately aimed at eliminating emissions by making more efficient use of resources.

The NDRC official said new pilot projects in specific sectors such as coal and chemical production are being designed to develop a greener economy. Pilot projects are also planned in other sectors such as electricity generation, building materials and recycling of household appliances.

"It's high time for us to change our economic development model," said Jiang.

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