MNI China Press Digest Dec 24: More Investment, PBOC, Cap Mkt

The following lists highlights from Chinese press reports on Friday:

• China needs increased infrastructure investment to boost demand and stabilize growth, but it should advance high-tech infrastructure without excess and wasteful projects, the 21st Century Business Herald said in an editorial. Developing a green economy is the key to achieving carbon peak and neutrality, which demands more investment in new energy and materials, energy conservation and environmental protection while investing in 5G, industrial use of the Internet and AI will also be accelerated to promote the digital economy, the newspaper said. China has ensured sufficient funding given issuances of local government special bonds may exceed CNY3.5 trillion in 2022, the newspaper said.
• The People’s Bank of China is adopting a more flexible policy approach to address the current economic downturn, judging by the recent cut to reserve requirement ratios and the refinancing rates for agricultural loans, the Economic Daily reported citing Tang Jianwei, chief researcher of the Bank of Communications. The central bank is also keeping its structural supports for SMEs, technological innovation and green development, the newspaper said citing Tang. The recent 5-bps cut to LPR will steadily reduce financing costs by lowering rates on current loans and repricing of existing loans, the newspaper said citing analysts.
• China should vigorously develop the capital market and increase the proportion of direct financing, as well as promote the innovation of bank and digital finance, so to better support the steady growth of the economy next year, wrote Huang Yiping, former member of PBOC’s Monetary Policy Committee in an article published on Yicai.com. China should better support innovative SMEs to promote sustainable growth, while the credit risk assessment based on financial data and mortgage assets are unfavorable to SMEs, said Huang, urging for more support to SMEs while using digital technology and big data to assess credit risks.