MNI China Press Digest, May 13: Xi, SMEs, Import, RRR Cuts

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

on Wednesday:

     Local governments in China should solve difficulties faced by companies

restoring production in a more timely and effective manner, President Xi Jinping

said during a visit to Shanxi province. Xinhua News Agency reported comments by

Xi, who also said local authorities should implement policies to expand domestic

demand and strengthen the real economy, with a focus on manufacturing, and let

major investment projects drive the economy. 

     China's support for small and medium-sized enterprises (SMEs) should focus

on expanding demand and increasing financial support, according to a statement

on the government website. The statement, which followed the meeting of the

State Council's Leading Group on SME Promotion, said China should accelerate

major investment projects, promote private investment and normalize demand for

services including catering and tourism. China should also strive to meet the

capital needs of SMEs by promoting the use of credit loans, financing

guarantees, policy loans, interest discounts, account receivables financing and

industrial chain financing, the statement said. 

     China's imports will start to rebound in May and June with double digit

growth, according to a report by the money.163.com. The report cited Wei

Jianguo, a former Vice Minister of Commerce, who said imports of bulk

commodities such as coal, iron ore and copper would increase steadily as more

infrastructure projects kicked off, while many cities would see a "blowout" in

demand for imported high-end consumer goods, agricultural products, seafood and

pharmaceutical products after the epidemic eases. The implementation of the

China-U.S. phase one deal would also help to promote imports, Wei said. 

     Reduced inflationary pressure through a slowing CPI will free up space for

further countercyclical adjustment in China, according to a commentary in the

China Securities Journal. Reserve requirement ratio (RRR) cuts and rate cuts to

the medium-term lending facility are both necessary to better mitigate the

impact of the epidemic and support the real economy, the newspaper said. Any

further RRR cuts should match the timing of issuing local government special

bonds or special Chinese Government Bonds, according to the commentary. 

--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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