Braving Challenges and Carrying out Financial Market and Credit Policy Work in 2019 with Innovative Efforts

On February 25-26, the 2019 PBC Financial Market Work Conference was held in Beijing. The conference thoroughly studied the guidelines of the 19th National Congress of the Communist Party of China (CPC), the second and third plenums of the 19th CPC Central Committee and the Central Economic Work Conference, as well as the requirements put forward at the 2019 PBC Work Conference. It reviewed the work of the PBC in the past year regarding financial markets and credit policy and set priorities for relevant work in 2019. Pan Gongsheng, member of the CPC PBC Committee and deputy governor, attended and addressed the conference. Zhu Hexin, member of the CPC PBC Committee and deputy governor, chaired the conference and made concluding remarks.

Communist Party of China

In 2018, under the guidance of the CPC PBC Committee, the financial market units of the PBC thoroughly studied the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, upheld the people-centered approach, faced up to challenges, and achieved progress in their work in an innovative spirit. Efforts were made to push forward regulated and innovative development of financial markets, enhance the role of macro credit policy in structural adjustment, and improve the capabilities and performance of the financial sector in serving the real economy. Various measures were taken to step up financing support for private enterprises and micro and small enterprises (MSEs). The bond market and other financial markets witnessed stable development and progressive opening-up. The special rectification campaign against internet financial risks was steadily pushed ahead. The macro regulation of real estate finance and the long-term mechanism for the regulation underwent continuous improvement. Increasingly more efforts were put into targeted poverty alleviation by the financial sector. Financial services for rural revitalization were rolled out in an all-round way. With multiple efforts underway to provide financial support for major national strategies and key areas, positive results were achieved on all fronts.

It was pointed out at the conference that the financial market staff of the PBC should follow the guide of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, strengthen the “Four Consciousnesses”, solidify the “Four Confidences”, and uphold the “Two Safeguards”. By adhering to the underlying principle of pursuing progress while ensuring stability, following the new philosophy of development, strengthening confidence, and taking pragmatic approaches to meet challenges, we should conduct guidance on macro credit policy and promote innovation-driven development of financial markets with best effort. Work needs to be done to deepen supply-side financial structural reform and to optimize financing structure, the financial market system and the financial product system with a view to providing higher-quality and more efficient financial services for the development of the real economy.

It was stressed at the conference that active steps should be taken to promote regulated and healthy development of financial markets with the aim of serving the real economy. We should explore the role of the bond market in supporting the real economy as well as capital replenishment by commercial banks and other institutions, promote the issuance of debentures with multiple measures, and move ahead with asset securitization stably. A market- and law-based default resolution mechanism should be established to safeguard stable bond market operation. Bond market opening-up, institutional innovation and product innovation should take steady steps forward. Coordinated regulation of financial infrastructures, monitoring of institutions and risk prevention should be strengthened. With regard to the gold market, the commercial paper market and the interbank lending market, more work needs to be done to enhance regulation, institution building and risk prevention so that all the markets will achieve innovative and regulated development. The special rectification campaign against internet financial risks should be carried on, and the making of rules for long-term regulation of internet finance be pushed ahead.

The conference required that the uses of loans and credit structure be optimized based on the law of market development. The role of the financial sector in providing services for the real economy should be stressed and financial services be extended exactly where they are most needed, so that credit policies can be better implemented to serve the real economy and the people’s well-being. Efforts should be intensified to carry out prudential management of real estate finance and the building of a long-term mechanism for stable and healthy development of the real estate market. Work should be done to enhance financial services for private enterprises and MSEs in an all-round way by improving monetary policy transmission mechanism, scale up the input of loans, promote bond financing, and pool the efforts of related government agencies. We should provide all-out support for fighting the tough battle against poverty, ensure the effectiveness of the work done, stress risk prevention, and promote sustainable development of the endeavors. More work needs to be done to step up financial support for major national strategies, key areas and weak links, such as rural revitalization, high-quality development of the manufacturing sector, coordinated regional development, and the follow-up to the expiration of the existing pilot program allowing farmers to collateralize their contracted land-use rights and housing property rights for loans.

It was noted at the conference that with China’s economic and financial development entering a new phase and the economy under downward pressure, we are faced with the arduous tasks of preventing and defusing financial risks and other major risks while many problems remain prominent. The financial market staff of the PBC should combine theory with practice to beef up research on subjects in focus, such as bond innovation aimed at supporting financing for the real economy, the improvement of commercial paper market, gold leasing, transmission of private enterprise- and MSE-related policies, rural revitalization, and high-quality development of the manufacturing sector, trying to grasp the pulse of financial market and credit operation and find solutions to difficult problems, so that policy making and implementation can become more effective. Efforts should be made to further improve our work style by complying strictly with the eight-point code and rectifying formalism as well as bureaucratism, shoulder our responsibilities enthusiastically, strive for achievement, and bring financial market and credit policy work to a new height in every way.

Attendees included officials in charge of financial market and credit policy work from PBC Shanghai Head Office, branches, operations offices as well as provincial level and sub-provincial level central sub-branches, and responsible officials from relevant PBC departments. Also present at the conference were responsible persons from the China Foreign Trade System, China Central Depository & Clearing Co., Ltd., Shanghai Gold Exchange, National Association of Financial Market Institutional Investors, Shanghai Clearing House, Shanghai Commercial Paper Exchange, and National Internet Finance Association of China.