China’s State-owned Assets Supervision and Administration Commission (SASAC) urged the central government’s state-owned enterprises (SOEs) to reform their businesses and improve profitability in the second half of this year.
Most of the central SOEs should strive to achieve relatively rapid growth in the second half of the year, Hao Peng, chief of the SASAC, told the heads of central SOEs in a recent video conference.
A three-year action plan for SOEs reform is expected to take the country’s reform in state-owned assets and firms to a new stage, said Hao.
During the first six months of this year, the combined revenue of the 97 central SOEs fell by 7.8% to 13.4 trillion yuan (US$1.91 trillion) from the same period last year. The central SOEs’ combined profits fell 37.7% to 438.55 billion yuan for the same period.
Market liquidity
The People’s Bank of China (PBoC) on Monday injected 100 billion yuan into the market through seven-day reverse repos at an interest rate of 2.2%, according to a statement on the website of the central bank.
The injection is intended to maintain reasonable and sufficient liquidity in the banking system, the PBoC said. As 50 billion yuan of reverse repos matured Monday, the operation led to a net injection of 50 billion yuan.
A reverse repo is a process in which the central bank purchases securities from commercial banks through bidding, with an agreement to sell them back in the future. China will pursue a prudent monetary policy in a more flexible and appropriate way, according to this year’s government work report.
Greater Bay Area
The China Development Bank (CDB), one of the country’s major policy banks, provided 200.2 billion yuan in financial support to the Guangdong-Hong Kong-Macao Greater Bay Area in the first half of 2020.
The funds were channeled for development of key areas including infrastructure connection, high-tech innovation, modernized industries and protection of ecology and the environment, the bank said.
The policy bank’s financing support for the Greater Bay Area will total 1 trillion yuan from 2019 to 2022, according to a CDB action plan. As of the end of June, 54% of the task had been completed.
Chinese authorities in February 2019 unveiled the outline development plan for the Guangdong-Hong Kong-Macao Greater Bay Area, aiming to develop the region into a role model of high-quality development.
Foreign investment in Hainan
From January to June, actual utilized foreign capital reached US$319 million, nearly doubling the figure last year, said the provincial government in China’s southern island province of Hainan.
During the same period, 203 new foreign-funded enterprises were set up in Hainan, up 24.54% year on year, thanks to the province’s free trade port policy. The new foreign-funded enterprises are from 30 countries and regions, it said.
Since the beginning of this year, Hainan has taken multiple measures to facilitate foreign investment. On June 1, China released a master plan for the Hainan free trade port, aiming to build the southern island province into a globally-influential high-level free trade port by the middle of the century.
Company news
The Industrial and Commercial Bank of China (ICBC), the country’s biggest commercial lender, saw its business of debt financing instruments (DFI) underwriting expand steadily in the first six months amid efforts to support Covid-19 prevention and control.
The bank acted as the lead underwriter for 1,412 DFI, whose total financing volume surpassed 910 billion yuan with a 25% year-on-year growth, according to a statement on its website.
It opened a green channel for the underwriting and issuance of bonds related to epidemic prevention and control, so as to facilitate fund-raising for pharmaceutical, logistics and transport companies. During the January-June period, the bank underwrote and issued 45 such anti-epidemic bonds, raising over 137 billion yuan for 41 clients.
The story was written by Xu Jiangshan and Liu Licong and first published at ATimesCN.com. It was translated by Nadeem Xu.