Business / Industries

Coal industry digs for solutions

By Li Jiabao and Sun Ruisheng (China Daily) Updated: 2014-03-12 07:22

"The interest rates at home are much higher compared with the costs of financing in overseas markets. As for loans to the SMEs, the benchmark interest rate floats up a lot, causing these businesses to turn to private funds," Li said.

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"It's more important to boost the real economy with better financial services than to keep giving the banks huge profits. This is a serious problem in China."

Shang Fulin, president of the China Banking Regulatory Commission, said the SMEs' financing problems stem from the "information asymmetry" between the banks and the enterprises as the guarantee for loans pushed up financing costs.

Linghu An, a member of the Standing Committee of the National People's Congress, attributed the financing difficulties to slow reforms of private capital.

"I think the slow reforms could lead to financial turbulence," he said. "We need to give more opportunities for private capital and expand the trial program for private banks..

Chinese Premier Li Keqiang said on March 5 when delivering the Government Work Report that China will steadily promote the establishment of small-and medium-sized banks and other financial institutions by private capital.

Liu Jianzhong, chairman of the Shanxi Coal Transportation and Sales Group Co Ltd, called for the provincial government to give approval for enterprises' capitalization of resources and to set up an exchange platform for capital flow to ease financing pressure.