The moderately loose monetary policy will be continued to support economic stabilization and recovery, Deputy Governor Su Ning reiterated at a financial meeting held at the PBC Shanghai Head Office few days ago.
Speaking at the meeting aimed at reviewing financial developments in Shanghai, Deputy Governor Su Ning pointed out that, in spite of the extremely complex domestic and international environment, the CPC Central Committee and the State Council managed the economy with strong initiative, and adopted a proactive fiscal policy and moderately loose monetary policy. Policies introduced to support economic growth, restructure the economy, promote reform and improve people s livelihood have produced significant results, Su said, noting that as these policies began to work, the economy has stabilized, and positive factors in economic performance have increased. Investment and consumption expanded, the agricultural sector and the service sector grew steadily, and industry production exhibited strong signs of recovery. Money and credit supply increased rapidly, and liquidity in the banking system remained abundant. Nevertheless, the Deputy Governor sounded a cautious note, saying China s economic development was now in a critical stage of stabilization and recovery. Difficulties and challenges remain, an economic recovery is yet to be firmly established, and there are still many unstable and uncertain factors both at home and abroad, he said.
Su stressed that, in the second half of 2009, the PBC would earnestly implement the overall arrangement of the State Council, further strengthen and improve macroeconomic management to support economic stabilization and recovery. The PBC will continue to take the task of promoting sound and relatively rapid economic development as the top priority of financial macro-management, ensure policy consistency and stability, and resolutely continue the moderately loose monetary policy. Efforts will also be made to properly manage policy priorities, pace and intensity, thoroughly carry out the package of stimulus policies and relevant policy measures, and make policies better targeted, more effective and sustainable.
The PBC would introduce more market-based measures rather than quantitative measures, and flexibly use various monetary policy tools in order to guide money and credit to grow in an appropriate and sustainable manner, thus supporting economic recovery and promoting sound and relatively rapid economic development. It will further optimize credit structure, and step up credit support to major infrastructure projects, technology upgrading and independent innovation of enterprises, energy conservation and emission reduction, and increase credit to SMEs. Meanwhile, the central bank will continue to rein in loans to high energy consuming, heavily polluting industries and industries with excess capacity, and curb lending to inefficient companies. Su called on financial institutions to act in line with the economic policies and arrangements of the State Council, and urged them to strike a proper balance between supporting economic growth and restructuring the economy and contribute to sound economic and financial development.
Mr. Tu Guangshao, member of the Standing Committee of the CPC Shanghai Committee and Vice Mayor of Shanghai, addressed the meeting. The meeting was chaired by Mr. Zhang Xin, Executive Vice President of the PBC Shanghai Head Office. Participants of the meeting included officials from the Shanghai municipal government, senior executives from Chinese and foreign banks operating in Shanghai, and officials from the PBC Shanghai Head Office.
