MNI China Press Digest Nov 19:Demand, Equity Finance, SOE Bond

The following lists highlights from Chinese press reports on Wednesday:

China's central government is seeking to raise domestic consumption by asking local authorities to reduce limits on car purchases, increase the release of license plates and subsidize the replacement of old cars, according to a readout from the State Council executive meeting on Wednesday. The State Council is also seeking to incentivize the replacement of home appliances and furniture with environmentally friendly new ones, The statement also said the government is calling for the development of "Internet + Tourism" to expand the tourism market, including building smart tourist attractions and encouraging scenic spots to increase their online marketing efforts. The government is also urging officials to deepen reform and speed up the implementation of the Regional Comprehensive Economic Partnership.

China needs to raise the proportion of direct financing from capital markets, particularly equity financing, to avoid an excessive reliance on bank borrowing, the Securities Daily reported citing an article by PBOC Governor Yi Gang. Bank loans currently play the major role in financing China's real economy, placing large risks on banks, and this is not an efficient use of financial resources, Yi said. China will implement the stock issuance registration system and establish a normalized delisting mechanism, the Daily reported citing the government's 2021-2025 Plan.

The province of Shanxi has vowed to restructure the debts and liabilities of its local state-owned companies and avoid adding risk to financial institutions, said Vice Governor Wang, according to an official WeChat blog. Wang was commenting after a bond default by Yongcheng Coal Group, an SOE in the neighboring Henan province, roiled the market this month and drew scrutiny over China's ageing domestic coal miners. Wang stressed that Shanxi, a province with a high concentration of coal mines. will increase securitization by SOEs and implement digitized management systems to aid with clearance, reduce costs and increase efficiency, and balance the ratio of assets to liabilities. The aim was to limit an escalation of debt among SOEs.