Support for real economy

The People's Bank of China and the Ministry of Industry and Information Technology, together with the country's banking, securities and insurance regulators, jointly issued a guideline recently aimed at providing greater financial support to the real economy.

The guideline seeks to forge a diversified system of financial organizations and financial products to support the Made in China 2025 strategy. In particular, financial support will be granted to innovative, transforming, high-tech enterprises, especially aerospace, semiconductor chips, and complete equipment manufacturing enterprises, while restrictions will be imposed on financial flows to sectors characterized by outdated production and overcapacity.

According to the guideline, large, well-performing manufacturing enterprises are now allowed to set up platforms to offer financing and equipment leasing to upstream enterprises in their respective industrial chains, buyers' credit to downstream enterprises, and finance leasing and consumption credit to the terminal product market.