MNI China Press Digest Sep 14: Slow Credit, LGFV Downgrade,MFG

The following lists highlights from Chinese press reports on Tuesday:

• China should ease the market's concerns for slowing credit demand by issuing more local government bonds and loans, the China Securities Journal said citing analysts including Ming Ming of Citic Securities. China's subsequent local debt-raising this year is expected to significantly rise and all the additional quotas this year will be used up, the newspaper said citing Ming. Fiscal policies are expected to actively spur infrastructure building and the real economy's demand for financing, said the newspaper. China's monetary policy is tilting toward targeted reductions in RRRs and rates to lower businesses' financing costs and bridge liquidity shortages due to renewing MLFs, the newspaper said.
• More investment entities owned by China's local governments are being downgraded, raising concerns for greater financial risks, as the business environment gets tougher and some regional economies face greater challenges, the 21st Century Business Herald reported. As of Sept. 13, 27 LGFVs this year have been downgraded, more than doubling the number from the same period last year, while the number of entities that got upgrade dropped 87% y/y, the newspaper said. Those that got upgraded ratings received external support including local government's free transfer of assets, capital injection, special funds and financial subsidies, the newspaper said.
• China's manufacturing investment is expected to grow about 12% y/y in 2021, with the two-year average growth likely at 5%, the Economic Information Daily said. Manufacturing investment will recovery steadily, as more policy supports help buiding advanced manufacturing and low-carbon transformation and ease the rising costs of raw materials for smaller manufacturers, the newspaper said. Cuts to taxes and fees, as well as financing supports, will be further strengthened, the newspaper said The central bank has made certain that it will provide more credit to support the real economy and strengthen investments in manufacturing and infrastructure, said the daily. Official data reported that manufacturing investment grew 17.3% y/y for the first seven months.