On July 31, State Council Premier Li Keqiang presided over the executive meeting to deploy the reform and development of financing and guarantee industry, better give play the finance’s role in supporting the real economy, decide to build a unified public resource transaction platform and promote the efficient and transparent resource allocation through management innovations.

 

According to the meeting, we should insist on the combination of market orientation and supportive policies to speed up the development of the financing and guarantee industry, deepen financial reform, and crack the financing nut for small and micro enterprises as well as agriculture, rural areas and farmers. The combination of market orientation and supportive policies is an important measure to complete the targeted adjustment, boost the “mass startup and innovation” and support the agriculture, rural region and farmers to intensify the vitality of real economy and consolidate the basis of national economy. First, we should establish a sustainable cooperation with the joint participation of governments, banks, financing guarantee institutions to shoulder the common risks and encourage the establishment of governmental guaranteeing funds in the competent regions for a reasonable compensation to the risks of the guaranteed loans of banks and financial institutions. Second, we shall establish national financing guarantee funds to boost government-leading provincial re-guaranteeing institutions to cover all regions within three years and jointly shoulder the business risks with financing and guaranteeing institutions. Third, at the provincial and municipal levels, we shall generally develop a group of governmental financing and guaranteeing institutions which have proper operation and good reputation, focus on the business, and server for small and micro enterprises, agriculture, rural areas and farmers.We support the merge and restructuring of financing and guaranteeing institutions to build good and powerful ones. Fourth, we will reinforce financial support and carry out the policies on exemption of business tax to financing guarantee institutions, pre-tax deduction of preparation funds, as well as the law-based mortgage registration, creditor’s right protection and compensation assistance to safeguard the legal benefits and interests. Five, we shall lower or cancel the profit requirement to governmental financing guarantee and re-guarantee institutions, properly improve the risk tolerance to loans of small and micro enterprises as well as agriculture, rural areas and farmers, and boost the reduction of guarantee service fees. We shall improve the credit record of financing and guarantee institutions, innovate in the classified supervision and differentiated management, set up long-term mechanism for standardized financing and guarantee business, effectively prevent and control financial risks, and better play the financing and guarantee’s role in sharing difficulties with agriculture and enterprises and boosting startup and innovation.

 

At the meeting, it is agreed that the construction of a standard, unified public resource transaction platform to boost the sunshine operation of resource transaction, marketized allocation, reasonable pricing and online operation is an important measure to deeply streamline administration, authorize administrative power, combine authorization and control, optimize service reform, innovate in supervision during and after the process, and build the modern market system. It is of great significance to improve governmental management level and efficiency, prevent power rent-seeking and corruption, and promote the convenient and efficient matching between startup, innovation and public resources.

 

Source: Website of Chinese Commercial News