MNI China Press Digest, May 19: PBOC, Electricity, SME Bonds

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

on Tuesday:

     The People's Bank of China must take careful control of financial

regulation and implement monetary and macro-prudential policy more creatively,

according to Guo Shuqing, party secretary of the central bank. In a statement on

the PBOC website, Guo said the central bank should maintain normal monetary

policy while increasing counter-cyclical adjustment. At the same time, the PBOC

should stabilize growth and employment while preventing risks and restructuring

the economy, Guo said. 

     China's power generation increased 5.6% y/y in the first half of May after

turning positive in April, Xinhua News Agency reported. The growth is the

fastest this year and shows the economy continues to improve, Xinhua said. The

rapid growth in generation is largely due to the fast recovery in industrial

power consumption, reflecting significant progress in the resumption of

production, said Shan Baoguo, deputy chief economist at the State Grid Energy

Research Institute. Power generation grew 0.3% y/y in April, reversing the 4.6%

decline in March, Xinhua reported. 

     China should lower the entry threshold for bond issuers and encourage small

and medium-sized enterprises (SMEs) to innovate in bond financing, the

Securities Times reported. The Times cited comments from Lai Xiufu, director of

the trust department of the China Banking and Insurance Regulatory Commission,

who is also a representative of the National People's Congress (NPC) and

submitted the bond reform proposals to the NPC. The proposals suggest that

regulators should be more tolerant of SMEs' net assets and debt ratios when they

apply for bond issuance, and suggest that institutional investors should achieve

a certain percentage of SME bond investment. 

--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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