MNI: China Press Digest, Mar 5: Money Supply, Reform, Property

     BEIJING (MNI) - The following are highlights from the Chinese press for

Monday:

     China must control monetary supply and limit increases in lending, which

are the most important steps in preventing financial risks, reported the

official Shanghai Securities News on Sunday citing Yang Weimin, the deputy head

of Central Leading Group on Financial and Economic Affairs. China must further

increase supervision of the financial industry, not loosen it, Yang was cited as

saying. China must continue to deepen supply-side reform, and get rid of zombie

companies and excess capacity, Yang said. Local governments most borrow with

prudence, not excessively nor through hidden means, Yang said. China needs to

contain "some bubbles" in the property market of some top three-tier cities: it

needs to not actively "pinch" the bubbles, or make them bigger, the newspaper

reported Yang as saying.  

***Comment: Yang set the tone for this year's congress meetings starting today

by listing the four targeted areas: money supply, financial risks, debt and the

property industry. 

     China will strengthen its economic monitoring, forecasting and warning

systems to help improve the government's foresight, Xinhua News Agency reported

Sunday, citing a communique from the Communist Party's Third Plenum concluded

over the weekend. China will "strengthen and optimize financial management

capabilities," and increase coordination among monetary policies,

macro-prudential policies and financial regulations. China must guard its last

line of preventing system financial risks and defend the country's financial

safety, it said. Overall, China will strengthen the control of power by the

Communist Party, which is lacking in some areas of the government. It will also

deepen reform of the governing structure and allow the market to better allocate

resources.  

***Comment: Chairman Xi Jiping's leadership is seeking to deepen control of

power. Under Xi's push for concentration of power, China will see wide-ranging

government reforms announced this month - including possibly the elevated status

of a central bank to be chaired by Xi's trusted right-hand man, Liu He.

     China will keep strict controls over the property markets this year, the

21st Century Business Herald reported, citing unidentified analysts. More

second- and third-tier cities are set to introduce policies that will curb real

estate growth, the Herald said. Overall property transactions will decline this

year, the newspaper said, citing analysts. Cities of Sanya, Wuhan and Kunming

have recently published guidelines to strengthen controls, including limiting

prices, sales volume and regulation of purchase deposits, reported the Herald.

--MNI Beijing Bureau; +86-10-8532-5998; email: beijing@marketnews.com

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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