Xinhua recently reported that the China Banking Regulatory Commission (CBRC) announced on January 7 that China is set to start an experiment to allow banks to be fully privately owned. The CBRC is planning to take a very conservative approach and allow only three to five banks this year. Meanwhile private capital can now be part of the ownership of current banks. The fully private banks will only be able to do business under a “limited license,” which will impose restrictions on the scope of business, operating regions, and customer profiles. In addition to these “limited restrictions,” all private banks will be required to establish a “will,” which must explain what will happen if the bank were to file for bankruptcy in a circumstance where taxpayers provided no bailout. Over thirty publicly traded companies have filed their applications to enter the banking business.

Source: Xinhua, January 7, 2014

http://news.xinhuanet.com/2014-01/07/c_125965308.htm

People’s Daily recently reported that Jiang Daming, Minister of Land and Resources, announced in a speech given at a conference that from now on cities with a population of over five million will not be granted new land resources for construction. However, this new rule does not apply to land that’s considered “living space,” which means the housing market will not immediately be impacted. Most of the capital cities of the provinces fall within the scope of the new rule. This is in line with the recently announced new policy of strict control of the scale of the population in large cities. The new rule focuses on managing the supply of industrial and business land. The Ministry of Land and Resources is encouraging cities to make better use of the land they have already been granted. Jiang also pointed out that, in addition to this new rule, more regulations are being planned to enable the clear identification of city boundaries. The up-coming policies will ensure the safety of permanent agricultural land.

Source: People’s Daily, January 10, 2014

http://politics.people.com.cn/n/2014/0110/c70731-24086306.html

China Review News (CRN) recently published an article discussing China’s macroeconomic trend, based on the goals set by the recent Third Plenary Session of the 18th Central Committee Conference of the Communist Party. The author expressed the belief that China’s rapid economic growth was largely based on demand that was not domestic. Over the past 35 years, China’s domestic consumer market has been playing less and less of an important role in its GDP numbers. The article identified four primary challenges China faces: 1) Taking advantage of the rapid developments in the science and technology space; 2) Reducing the dependency on pure government investments for economic growth; 3) Adjusting the economy gracefully to deal with the lack of younger workers due to an aging society; 4) Balancing the domestic economy and China’s role in the global economy. The author called for a significant change of the economic growth model and structure so as to focus more on domestic consumers. 

Source: China Review News, January 12, 2014

http://hk.crntt.com/doc/1029/7/4/5/102974525.html?coluid=53&kindid=0&docid=102974525&mdate=0112082909