Link: https://nyti.ms/2yAauM6
Date: Wednesday 11, October 2017
Media: The New York Times
What happened?
This news
is about how China tries to steer more bank loans to small businesses. They
are trying to do this by lowering banks' reserves.
China is
taking measures to inject money decreasing the requirements of banks and in a way that doesn't pose a greater debt to the country.
Whom and where it affects?
It affects
the small businesses of China.
What sort of public or private institutions are
involved?
The Popular
Bank of China, Standard & Poor, Central Bank of China, Tsinghua University,
China Government and China Financial Reform Institute.
Why is it important for Banking and Finance?
Because it talks about the financial system of China, bank loans and the reserve ratio.
What do you think will be the consequences in the
foreseeable future?
It
stimulates the economy, flowing more credit and improving the purchasing power
of the population. If these measures were not correct, the consequences could seriously affect the Chinese financial system, and consequently, the global economy could be harmed.
Key words:
China, Bank Loans, Financial system, Small
Business, Reserve Ratio.
In my opinion, this measure adopted by the Chinese government is very consistent when trying to inject liquidity into small businesses.
ReplyDeleteThis is achieved by reducing the minimum amount of money that financial institutions must keep. So it will be easier to provide loans.