Financial Authorities Declarations
- Flash News !
-The National Food and Strategic Reserves Administration released 150 000 tonnes of copper, aluminum and zinc from reverses to smooth commodity prices hike.
-Swire Coca-Cola Ltd., a bottler of Coca-Cola invested 900 million Yuan in Zhengzhou to plant a bottlery plant. The companie expected to be operational in two years with a maximal annual production of 1 million tonnes. The group has already 18 plants in China.
-The State Taxation Administration released data based on VAT invoice recorded during the National Day Holidays; the “Golden Week” from 1 to 7 October; to gauge the dynamics of consumption. The Wholesalers and Retailers registered respectively an increase of 9.9% and 25.4% of their average daily sales revenues compare to 2019 level.
-The Inner Mongolia Autonomous Region, one of the main coal production center in China, declared working on increase coal production to cope with energy rising demand expected in Winter and Spring. Efforts are concentrated in Ordos city area to boost its production, currently at 2.1 million tonnes per day (the peak of the year).
-The State Administration for Market Regulation (SAMR) fined Meituan, one of the internet giants of online food delivery platform, 3.442 Billion Yuan for market domination abusive behaviors. The fined is equal to 3% of the domestic sales revenue registered in 2020 (114.7 Billion Yuan). The SAMR ordered Meituan to stop its illegal activities and to rectify its misconduct while improving its system to better protect both consumers and merchants’ rights.
- The CSRC approved IPO !
The China Securities Regulatory Commission. (CSRC) approved IPO on the Shenzhen ChiNext market of Beijing Dataway Horizon Co., Ltd., Suzhou Wanxiang Technology Co., Ltd. and Guangzhou Jinzhong Auto Parts Manufacturing Co., Ltd. In addition, the Sichuan Zigong Conveying Machine Group Co., Ltd received approbation to be listed on A-share market.
- Banking and Insurance Regulator urge Financial Institution to do their duties of lenders and stabilizer of the market and economy without speculation !
The China Banking and Insurance Regulatory Commission (CBIRC) released a document urging to strengthen financial support coal and electricity producers to maintain order in the commodity market.
Banks and insurance institutions are urged to provide sound financial services to producers of key commodity (coal, steel, non-ferrous metal) to help them to secure supplies, production especially in electricity/power generation sector despite volatility of prices.
The CBIRC clearly indicated that speculating behaviors on prices by banks are strictly prohibited and financial institutions are not allowed to withdraw or cutting off loans to energy producers.
The regulators also reaffirmed that any speculation on final consumer goods is also prohibited using excessive loans, or related practices.
“Measures should also be taken to prevent speculation on high-end consumer goods using business and consumer loans; illegal inflows of bank and insurance funds into stock, bond and futures markets; and behaviors inducing consumers to borrow blindly and spend excessively.” As indicated in the circular.
Investigations are ongoing and will be introduced at large-scale to identify prices gouging and hoarding behaviors. Punishment and sanctions for law violations will be granted in consequence.
Central Bank Operations and declarations
|September 2021||MLF||4-years||600 Billion Yuan||2.95%|
|MLF outstandings||5 Trillion Yuan|
|October 8||Reverse Repo||7-days||10 Billion Yuan||2.2%|
|October 9||Reverse Repo||7-days||10 Billion Yuan||2.2%|
The People’s Bank of China (PBOC) conducted Standing Lending Facility (SLF) operations amounting 2?46 Billion Yuan in September 2021. In breakdown, overnight operations registered 0.03 Billion Yuan at 3.05% , 7-days registered 2.33 Billion Yuan at 3.2% while 1-months stood at 0.1 Billion Yuan at 3.55%. Total SLF outstanding reached 1.43 Billion at the end of September.
- PBOC warns against new technologies related risks !
The PBOC warns against the ‘’ the double-edged’’ effect of certain technologies which can cause instabilities.
PBOC Governor, YI Gang declared that the financial regulatory system is improving and adapting to face challenge caused by introduction of new financial technologies.
Governor Yi indicated that new technologies are useful to enhance the efficiency of the financial system by lowering costs, reducing time process etc … but also generated ‘’bad behaviors’’ making possible to exploit the weak points of the regulatory system.
As example, the current digitalization of credit process meets the demand of loans reducing administrative process for SME but also favoring illegal activities such as non-licensed financial business, unfair competitions or consumer private data collection.
“In the next stage, China will continue strengthening the supervision of payments. Measures should be taken, including advancing the regulation of financial holding companies, as well as exploring more convenient data transactions and more reasonable data use, on the basis of ensuring privacy and data security” Governor said.
- Rural Area Development !
The Chinese Government plans to develop housekeeping service sector in rural area to consolidate the poverty alleviation policy and boost vitalization of rural environment in the next 5 years (14th 5-Years Plan period).
“By 2025, China expects to make it easier for rural labor, especially those lifted out of poverty, to find jobs in the housekeeping sector […] In five years, the housekeeping service sector should play a stronger role in creating jobs and improving people’s well-being. It will become better branded, more professional, better informed, and regulated” said a document jointly issued by 14 government departments, including the Ministry of Commerce.
|Foreign Exchange Reserves||3.2006||Trillion Yuan|
Sources : Ministry of Finance, People’s Bank of China and the State Administration of Foreign Exchange, National Bureau of Statistics, Ministry of Commerce, Ministry of Finance, General Administration of Customs, State-owned Assets Supervision and Administration Commission