Accelerating rural financial reform and making it easier for
people in rural areas to access capital are key parts of the
country's effort to reform its overall financial system, according
to the National Financial Work Conference.
The conference called for measures to improve financial services
in rural areas to support the government's plan to create a "new
socialist countryside".
The government is to speed up the establishment of a
wide-reaching multi-level, sustainable financial system in rural
areas, which have been underserved by the existing financial
system.
The conference called for commercial, policy-financing,
cooperative and other financial institutions to enter the market of
rural finance.
The meeting produced "crucial ideas for future rural financial
reform", said LinYifu, of Peking University.
Lin said China's current financial structure does not give
sufficient support to rural areas, leaving many farmers and rural
businesses without the capital they need to develop.
He added that rural finance is the weakest point in the
country's entire financial system.
Low profits for rural cooperatives, a lack of rural financial
products and services and the difficulty many farmers experience in
securing loans are some of the problems plaguing the rural
financial system.
Official statistics show that people in rural areas have less
access to financial services than their urban counterparts. Only 60
percent of the 120 million rural households that need bank loans
are able to access them.
At present, farmers are responsible for only 15 percent of the
country's total bank loans and deposits. Per capita borrowing among
farmers amounted to 5,000 yuan at the end of 2005, less than 10
percent of the amount in cities. Detailed measures to address the
situation are expected soon.
At the conference, Premier Wen Jiabao called for the
establishment of diversified financial institutions and
microfinance services in rural areas.
To this end, the China Banking Regulatory Commission launched a
pilot program in Sichuan, Gansu, Qinghai, Hubei, Jilin and the
Inner Mongolia last month that made it easier for financial
institutions to open outlets in rural areas.
(China Daily January 22, 2007)