SCIO briefing on China's financial statistics 2020
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E-mail China.org.cn, January 18, 2021
Speakers:
Chen Yulu, vice governor of the People's Bank of China (PBOC)
Ruan Jianhong, spokesperson for the PBOC and head of its statistics and analysis department
Sun Guofeng, head of the monetary policy department at the PBOC
Zou Lan, head of the financial market department at the PBOC
Chairperson:
Shou Xiaoli, deputy head of the Press Bureau of the State Council Information Office
Date:
Jan. 15, 2021
Shou Xiaoli:
Ladies and gentlemen, good afternoon. Welcome to this press conference. This is the latest in a series of briefings on China's economic performance in 2020. We are delighted to invite Mr. Chen Yulu, vice governor of the People's Bank of China (PBOC), to introduce China's financial statistics in 2020. He will also answer some of your questions. Also present are Ms. Ruan Jianhong, spokesperson for the PBOC and head of its statistics and analysis department; Mr. Sun Guofeng, head of the monetary policy department at the PBOC; and Mr. Zou Lan, head of the financial market department at the PBOC.
Now, I give the floor to Mr. Chen Yulu.
Chen Yulu:
Friends from the media, good afternoon.
2020 was an extraordinary year. The COVID-19 pandemic - a once-in-a-century health crisis - had a severe impact on social and economic development in countries around the world. Faced with the complex domestic and international landscape, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the People's Bank of China firmly implemented the decisions and plans made by the CPC Central Committee and the State Council, as well as the requirements set out by the financial stability and development committee under the State Council. We made comprehensive moves to push forward integrated statistical work in the financial sector and keep abreast of the epidemic dynamics and the conditions facing economic and social development. In response to the shifting situation, we adopted a flexible approach to adjust the intensity, pace, and focus of our monetary policy, thus creating a prudent and favorable monetary and financial environment for epidemic prevention and control, stability on the six fronts (employment, finance, foreign trade, inbound investment, domestic investment, and market expectations), and security in the six areas (jobs, daily living needs, food and energy, industrial and supply chains, the interests of market players, and the smooth functioning of grassroots government). On Jan. 12, the PBOC published the 2020 Financial Statistics Report. Statistics showed that in 2020, China's main financial indicators were in line with expectations, and the financial system operated smoothly.
First, the growth of money and credit supply largely met the annual target. By the end of 2020, the M2 money supply increased by 10.1% year-on-year, 1.4 percentage points higher than that in the same period during the previous year; new RMB loans totaled 19.6 trillion yuan, an increase of 2.8 trillion yuan compared to the previous year; aggregate financing in the economy grew by 13.3%, 2.6 percentage points higher than that in the same period of the previous year. Throughout the year, the PBOC reduced required reserve ratios three times, unleashing 1.75 trillion yuan in liquidity for the real economy. We launched monetary policy measures involving more than 9 trillion yuan, achieving the policy goal of "maintaining moderate monetary aggregate, and reasonable and ample liquidity."
Second, the credit structure improved as loans to manufacturing firms and MSMEs (micro, small, and medium enterprises) continued to deliver benefits and targeted financial support for key areas of the real economy increased. In 2020, the outstanding balance of medium- and long-term loans to the manufacturing sector surged by 35.2%, 20.3 percentage points higher than that in the previous year. The growth rate has risen for 14 consecutive months. Inclusive loans to small and micro companies grew by 30.3%, 7.2 percentage points higher than that in the previous year. Additionally, the financial policy to curb housing prices gradually took effect, and growth in the outstanding balance of loans to the real estate sector fell for 29 consecutive months.
Third, supply-side structural reform in finance was deepened, and financing costs for the real economy dropped significantly. In 2020, the market-based interest rate reform moved forward and the switch of the benchmark for pricing existing floating-rate loans was completed as scheduled. The interest rate reform continued to deliver benefits and the transmission of monetary policy demonstrated higher efficiency, leading to a noticeable decline in interest rates on loans to enterprises. At the end of 2020, the weighted average interest rate on enterprise loans in China was 4.61%, 0.51 percentage points lower than in the same period of the previous year and the lowest level since records began in 2015. China's financial institutions did all they could to cut financing costs for enterprises and achieved the goal of saving enterprises 1.5 trillion yuan to boost the real economy.
Fourth, we offered financial support to win the "three battles" of risk management as well as poverty elimination and pollution control and achieved remarkable results. In 2020, the battle of preventing and defusing financial risks achieved important results. All P2P platforms have been "cleared up." Various types of high-risk financial institutions have seen orderly disposal, the size of "shadow banks" was scaled down, and asset-management product risks were contracted. The interbank operating relevance and nesting saw a continued reduction, while in the meantime, the PBOC firmly supported winning the battle of poverty alleviation through precisely targeted measures. More than 6.5 trillion yuan in loans for targeted poverty alleviation were issued in the past five years, comprising loans for impoverished people and for promoting industrial development. These loans benefited more than 90 million impoverished people and helped all impoverished counties to rise out of poverty. In recent years, the PBOC has offered support for green development and ecological civilization construction by providing green financing and has gained wide acclaim from abroad. Currently, our country ranks first globally in terms of green credit and second in the scale of green bonds.
Financial statistics data is the "transcripts" of the financial system. In 2020, facing the COVID-19 epidemic that raged worldwide and stricken by external risks, people working on the financial front put the interest of the people before everything else. We faced the difficulties head on, took action, and accomplished various tasks assigned by the Party Central Committee and the State Council, contributing financial powers to accomplishing the main objectives and tasks of the 13th Five-Year Plan and to securing a decisive victory in building a moderately prosperous society in all respects. 2021 marks the first year of 14th Five-Year Plan. The PBOC will fully implement the spirit of the fifth plenary session of the 19th CPC Central Committee and the Central Economic Work Conference and will prioritize stability, emphasize work, reduce risks, deepen reform and opening-up, and offer high-quality financial support to speed up the construction of new development patterns. I will stop here. Please raise your questions. Thank you.
Shou Xiaoli：
Thanks for the instruction of Mr. Chen. Next, journalists, please state the news outlet you belong to and then ask questions.
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