- According to the article Private Lenders Thrive in China as Banks Neglect Small Clients, Jane Cai articulates that the banks in the greater China region are unwilling to offer financial services to the population’s small and private investors. This is in contrast with the growing number of wealth management firms and loan guarantors whose main objective is to meet the growing demand of financial services. The author claims that although the Chinese Government is tuned towards establishing reforms that will make funds accessible to the entire population, it is not in opposition to the ever-increasing number of financial intermediary firms. According to the author, the liberalization of the money sector has resulted in many financial institutions lending at usurious interest rates ( Cai 1). Private lenders flourish under a less regulated financial environment and the parties at stake are borrowers.
- In the article China Regional Focus: Hangzhou, Zhejiang Province, the author Yao Lu focuses on the economic overview, developmental zones and the investment opportunities in the Zhejiang Province. The author identifies the province as a “financial center in the south wing of the Yangtze River Delta and a traffic hub for southeast Asia.” (Lu 1). The region has been marked by significant economic growth in the past decades. Hangzhou is the capital of Zhejiang Province and is characterized by a rather successful service sector. Industry also forms a major part of the province’s economy. Major development zones in the city include the Xiao Shan and the Hangzhou Economic and Technological Development zones, Hangzhou Export Processing and Hi-Tech Industrial Development zone. The province undoubtedly offers great investment opportunities such as energy saving, information technology, manufacturing, new material, new energy and modern service industry. These industries also offer potential employment opportunities. Zhejiang’s government has also put in place several policies that encourage foreign investment.
- In relation to the article China Considers Newly Proposed Free Trade Zones on the China Briefing Magazine, the author states that China seeks to trade in new regions since the launch of Shanghai free trade zones (FTZ) (“China Briefing” 1). Guangdong, Macau and Hong Kong are the important areas along the Pearl River Delta that will form the new FTZ. The new zone will borrow designs from the present Shanghai zone together with some new developments. The Pearl Delta incorporating the three areas will be more liberalized and innovative. Its main highlight will be logistics, manufacturing, maintenance, international trade, research, and development. Many regions are keen on building their own free trade zones since the advent of the one in Shanghai. The Chinese government has also considered approving these projects in the near future. Evidently, free trade zones are likely to become common in China. The main objective of free trade zones is to stimulate regional amalgamation and ease trade.
- According to the article, Expanded Powers Sought for Regulators, Enoch Yiu acknowledges that the Chinese government seeks to amend its laws to grant more power to regulators so that they can overpower giant financial institutions. This move is aimed at bringing China in line with certain international rules. These rules require that all major markets “empower regulators to handle big financial firms’ failures speedily without resorting to taxpayers’ money.” (Yiu 1). The use of public funds to bail out firms is more than just a moral hazard. The law is intended to prevent this and ensure that the customers’ interests are safeguarded. This means that the Hong Kong Monetary Authority will be bestowed upon the power to transfer the ownership of any financial firm that is on the verge of collapse. The proposed law change is likely to receive a positive response from the members of the public.
“China Considers Newly Proposed Free Trade Zones.” China Briefing. China Briefing Magazine., 31 Dec. 2013. Web. 9 January 2014.
Cai, Jane. “Private Lenders Thrive In China as Banks Neglect Small Clients.” South China Morning Post. South China Magazine., 6 Jan. 2014. Web. 9 January 2014.
Lu, Yao. “China Regional Focus: Hangzhou, Zhejiang Province.” China Briefing. China Briefing Magazine., 2 Jan. 2014. Web. 9 January 2014.
Yiu, Enoch. “Expanded Powers Sought For Regulators.” South China Morning Post. Soutn China Magazine., 8 Jan. 2014. Web. 9 January 2014.
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