MNI China Press Digest June 9: Reforms, Shanghai, NEVs

Highlights from Chinese press reports on Friday:

• Policymakers should deepen the reform and opening of economic and social systems to revitalise the financial system and the economy, according to an editorial by Yicai. China’s system creates high real interest rates which represses the private economy, while powerful state-owned firms benefit from lower interest rates. The banking sector shows signs of asset shortages as deposit and loan spreads have narrowed. Looking forward, financial firms will face pressure from increased non-performing loans, as the economy’s macro-leverage ratio increased by 8.6pp in Q1 2023.
• Shanghai will make further reforms to its financial centre aimed at high-quality development, according to Tu Guangshao, chairman of the Shanghai Institute of New Finance. Speaking at the Lujiazui Forum, Tu said the local government would develop the Shanghai International Financial Center 3.0, with policies to promote technological and green innovation. Authorities would expand the wealth management industry, to suit the needs of people and the real economy, Tu said. Shanghai’s finance industry would take the lead on reforms to asset-price mechanisms and risk-management functions. (Source: Yicai)
• China will launch activities to promote the consumption of new energy vehicles, according to the Ministry of Commerce (MOFCOM). The ministry will encourage financial companies to improve access to automobile credit as part of the measures. MOFCOM said rural areas will receive support to train more maintenance engineers and increase infrastructure for maintenance and charging. Additionally, the government will coordinate with relevant departments to expand rural charging piles and power grid support, the announcement said. (Source: 21st Century Herald)