Economy/Resources - 141. page

On August 28, Chinese Premier Li Keqiang chaired a State Council special meeting on new developments in the global economic and financial field and their implications for China and China’s policy responses. It was the first time that he called for such a special meeting, indicating that China faces tough issues in the area of economic growth. 

People’s Daily reported that, on August 29, the National People’s Congress passed a resolution setting the cap for the government debt in 2015 at 16 trillion yuan (US$2.51 trillion). The number consists of 15.3 trillion yuan (US$2.4 trillion) for the debt existing at the end of 2014 plus 60 billion yuan (US$9.4 billion) of new debit from 2015. The report said that it is the first time that China has set a limit on what the local governments can borrow. The People’s Congress also revised the commercial bank regulation. Effective October 1, 2015, it eliminated the ratio of 75 percent of savings to borrowing. The article said that the ratio has been in existence for 20 years, but due to the slowdown in the economy, banks need to increase their support for the real economy. Moreover, since commercial banks have been commercialized and can assume all of the risks themselves, the limit is no longer needed.

Source: People’s Daily, August 30, 2015
http://finance.people.com.cn/n/2015/0830/c1004-27531602.html

RFA reported that China stated it had planned the investment of two trillion yuan in pension funds in the stock market in order to grow their value. It denied that the move was to save the stock market. The investment of pension fund money in China, until recently, was limited to bank savings and Treasury bonds. The new regulation allowed the pension funds to be invested in stock and in mutual funds but the ratio for investing in stock is capped at 30 percent of the total. RFA reported on interviews it had conducted on this issue. Some of those interviewed expressed concern about the corruption in the stock market. Some thought that it was a risky move because China’s stock market is just not well regulated. Another concern was that Chinese people don’t have control over how the pension funds are managed even though they are the beneficiaries. According to the 2014 Chinese Pension Development report that the China Academy of Social Science published, due to mismanagement, pension funds, social security funds, and savings have lost close to 17.5 billion yuan. Some reports indicated that the government used the pension funds for funding the government.

Source: Radio Free Asia, August 28, 2015
http://www.rfa.org/mandarin/yataibaodao/jingmao/yl-08282015155834.html

On August 26, 2015, Radio Free Asia (RFA) published an article commenting on how quiet China’s official media have been on the China stock market slump. The sharp fall of the stocks in China’s market affected at least 70 million Chinese active investors as wells as the whole global stock market. However, those media that are China’s official mouthpiece, such as People’s Daily, Xinhua, and China’s Central Television did not even mention such a big incident. Why not? According to one of the interviewees, China’s official media always like to report good news rather than bad news. When, from the government’s point of view, there is no hope for China’s stock market, it is normal for the official media to avoid the topic.”

Source: Radio Free Asia, August 26, 2015
http://www.rfa.org/mandarin/yataibaodao/meiti/cyl-08262015105903.html

Within a period of 10 days in August 2015, former Chinese regime leader Jiang Zemin’s inscriptions were removed from two different locations: the Shanghai Air Force Political Academy on August 13 and the Chinese Communist Party Central Party School on August 21. The Chinese Communist Party has a tradition of removing sacked officials’ inscriptions. For example, inscriptions by Guo Boxiong, Xu Caihou, and Zhou Yongkang were all removed after they were arrested. Guo, Xu, and Zhou were all members of Jiang’s faction.

Many people viewed the removal of Jiang’s inscriptions as an indication of the elimination of Jiang’s influence and an omen of his impending political demise. Some others thought it was just a normal engineering operation, since Jiang was fond of leaving inscriptions and writing poems as he traveled with his entourage around the country. They thought it was normal to make some changes.

Source: World Journal, August 24, 2015
http://www.worldjournal.com/3397067/article-%E6%B1%9F%E6%BE%A4%E6%B0%91%E9%A1%8C%E5%AD%97%E8%A2%AB%E7%A7%BB-%E3%80%8C%E5%8E%BB%E6%B1%9F%E5%8C%96%E3%80%8D%E7%82%B8%E4%BA%86%E9%8D%8B/?ref=%E8%B6%85%E4%BA%BA%E6%B0%A3