MNI China Press Digest, April 24: Foreign Capital, Bank, Home

     BEIJING (MNI) - The following lists highlights from Chinese press reports

on Friday:

     Foreign capital will not leave China on a large scale despite repeated

rhetoric from western politicians about moving manufacturing chains out of the

country, said state-controlled media Economic Daily. In a commentary, the

Economic Daily said that China is the first country to contain the pandemic and

will continue to be a stabilising influence and a boost for the world economic

recovery. This would provide stability for foreign capital, the commentary said.

Although some foreign companies have moved factories to locations in Southeast

Asia, they are also deploying investment projects to produce more value-added

goods in China, the Daily added. 

     Companies in China are selling short-term notes in the liquid interbank

market or obtaining subsidized loans to buy deposit products at banks, and are

then arbitraging the spread between short-term financing costs and yields on

deposits, the China Securities Journal reported after analysing company

announcements. Citing Guo Yixin, an analyst with China Industrial Bank Research,

the Journal said the spread between the short-term financing costs and interest

rates offered by deposit products can be as high as 150 bps. 

     China should stay highly vigilant against any perverse expectations of

looser housing regulations, the Economic Information Daily said in a front page

commentary. Although China is facing great pressure to stabilize the economy,

this does not mean policymakers will tolerate rising home prices, the newspaper

said. Any irrational increase in home prices inhibits consumer demand and widens

the income gap, which in turn hinders economic and industrial transformation,

the newspaper added. 

--MNI Beijing Bureau; +86 (10) 8532-5998; email: wanxia.lin@marketnews.com

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

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