MNI China Press Digest June 1: Reinsurance, PMI, Real Estate

Highlights from Chinese press reports on Thursday:

• Shanghai will soon launch its International Reinsurance Centre in line with international standards, according to Ge Ping, deputy director of the Shanghai Local Financial Supervision Bureau. Speaking at a recent conference, Ge said the government will attract foreign and domestic insurers through policy support including tax incentives, improved regulation and convenient cross-border capital transfers. Shanghai also plans to build a global asset management centre where investors can better access investment channels and have more risk hedging tools available.
• China’s weak PMI data in May shows domestic demand remains insufficient which adds pressure to the fine tuning of macro policy, the 21st Century Herald said. Interviewing analysts and experts, the paper noted the economy’s overall recovery trend has not softened substantially, but has fallen short of analysts expectations at the start of the year. Policymakers must expand infrastructure construction and government investment to overcome weakness in the manufacturing, real estate and export sectors, the paper said.
• The Government should embrace high-quality development and not restart the old speculative real-estate model, despite recent weak PMI and PPI data, according to an editorial from Yicai. The paper said the Government should resist calls from analysts and experts for excessive property sector stimulus, as this could restart speculative practices which would not deliver high-quality growth. Policymakers should take measures to ensure the property market remains healthy and ensure prices follow market fundamentals. Going forwards, authorities must reduce the economy’s operating costs and increase the marginal rate of return on investment.