MNI China Press Digest, Aug 22: LPR, Fiscal Policy, China-U.S.

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

on Thursday:

     The PBOC should improve the Loan Prime Rate (LPR) pricing mechanism by

strengthening the quality checking of LPR quotations by commercial banks,

according to the PBOC-run newspaper Financial News. Citing Zhang Ming, a senior

fellow at the Institute of World Economic and Politics under the Chinese Academy

of Social Sciences, the report said that in order to drive down lending rates,

the PBOC should also break the implicit lower limit of interest rates set by

banks.

     China has sufficient fiscal policy tools to stabilize its growth rate if

economic conditions decline more than expected, China Securities Journal said in

a front-page commentary. The government could consider using the remaining quota

of local government special bond issuance from previous years, if the economic

situation deteriorates, even though the current policy focus was on tax and fee

cuts, the newspaper said.

     Chinese state-owned enterprises (SOEs) are independent players which

participate equally in market competition, despite U.S. criticisms that they are

heavily subsidised, the People's Daily said in a commentary. The Daily said that

some U.S. criticism of SOE's was driven by envy and anger at the SOEs' global

expansion. The commentary said the U.S. should look to itself before making

criticisms, as U.S. governments at all levels had granted USD178.1 billion in

subsidies to domestic companies through 80,337 projects since the 1980s.

--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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