China cuts some banks' reserve requirement ratios -- China's central bank announced on April 17 that it will cut the reserve requirement ratio (RRR) for most commercial and foreign banks.
The People's Bank of China (PBOC) will cut the RRR for most banks by 1 percentage point from April 25 to help small businesses, and to improve overall stability and liquidity in the economy. The move does not include policy lenders such as the China Development Bank. Funds released will be used to pay back medium-term lending facilities, according to the PBOC website.
China explores mediation in business disputes -- Chinese chambers of commerce are encouraged to set up mediation committees and hire mediators to settle business disputes in non-public sectors outwith judicial proceedings. The All-China Federation of Industry and Commerce (ACFIC) and Ministry of Justice have jointly issued a document to promote mediation of disputes by chambers of commerce, said an ACFIC press release on April 17. The document suggests that mediation committees be established by chambers of commerce to settle civil disputes raised by chamber members. The policy is aimed at better serving about 25 million private firms and more than 60 million self-employed people across China, the statement said.
China to phase out share-holding limits for foreign investors in manufacturing sectors -- China will scrap share-holding limits in the automobile, shipbuilding and airplane manufacturing sectors for foreign investors, the top economic planner said on April 17. Share-holding limits for special-purpose vehicles and new energy vehicles will be scrapped for foreign investors in 2018, while those for commercial vehicles and passenger vehicles will be lifted in 2020 and 2022 respectively, said the National Development and Reform Commission (NDRC). The limits will be lifted this year on shipbuilding processes including design, manufacturing and repair, and on production of airplanes including trunk and regional airliners, general-purpose airplanes, helicopters, drones and aerostats, according to the NDRC.
China to roll out new negative lists for foreign investors -- China is making new negative lists to expand market access for foreign investors, the country's top economic planner said on April 17. There will be two new negative lists: one that applies to the free trade zones and another for the rest of the country, according to the National Development and Reform Commission (NDRC). The list for the FTZs includes bolder opening-up policies, the NDRC said. China started to pilot a negative list approach in the Shanghai FTZ in 2013. All sectors are open to foreign investors except for those outlined in the negative list.
China encourages central SOEs to gradually adjust industrial structure -- China is encouraging central state-owned enterprises (SOEs) to gradually adjust their industrial structure, the country's SOEs regulator said on April 16. The SOE sector has seen a gradual reduction in its share of the overall economy since 1978, but its competitiveness has been gaining strength, said Peng Huagang, spokesperson for the State-owned Assets Supervision and Administration Commission (SASAC). SOEs will phase out from some sectors while expanding presence in others, but it might be difficult to define a clear share of the SOEs' presence in certain sectors, Peng pointed out.
China eyes wider opening up with QDII reform -- China is taking another step in opening up the financial market with reform of the Qualified Domestic Institutional Investor (QDII) scheme. The State Administration of Foreign Exchange (SAFE) said in a statement that it would work with other government entities to push QDII reform and improve the macro-prudential management of the program. SAFE will release QDII quotas monthly on its website, it said in the statement. The scheme allows qualified domestic investors to invest overseas and encourages two-way capital flows, according to Xie Yaxuan, an analyst with China Merchants Securities.
A single purchase
