China S Financial Sector Reform In The Transition To A Market Economy

" The book is a problem-oriented study of China's financial sector in the transitional process since 1979. It provides deep and precise insights into the characteristics and problems of China's financial sector with respect to investment finance, the central banking and commercial banking systems, the financial market, and the legal and institutional framework of bank supervision in China. More importantly, the book has also proposed workable strategies for resolving two acute problems: interest rate liberalization and solving the issue of non-performing loans in China's banking system. The recent financial crisis in Asia is also a subject of the book, especially as regards its effects on the banking sector, stock markets, and extemal financial market liberalization in China. Furthermore, a projection is made about the trends in Chinese economic policies, particularly the interest rate policy, the exchange rate policy, and the fiscal policy, and about the perspectives of China's financial sector reform. This book is a valuable reference for academic researchers, investors, business managers, and policy-makers who are concemed with China's banking and financial system. "

China's prospects of successfully completing the transition to a market economy and becoming the world's largest economy during the 21st Century depend on the future sustainability of high rates of economic growth. This book is a comprehensive, balanced and realistic assessment of China's financial reform program and future direction. Covering not only the banking sector but also non-bank financial institutions, stock market development and external financial liberalization, the authors examine the impact of financial reform on economic development in China during the reform period. This volume will facilitate a more accurate assessment of the Chinese approach to financial reform, and will therefore allow more informed future policy choices for both China and other developing and transitional countries.

China's increasing role in global economic affairs has placed the country at a crossroads: how many and what types of international capital-market transactions will China permit? How will China's financial system change internally? What kind of relationships will the Chinese government develop with foreign financial institutions, especially with those based in the United States? Can China broker a sustainable partnership with America that will avoid sending economic shock waves throughout the world? Drawing on the contemporary research of prominent international scholars, the experts in this volume outline the trajectory of China's financial markets since the advent of reform and anticipate their uncertain future. Chapter authors and commentators include Geert Bekaert, Loren Brandt, Lee Branstetter, Mary Wadsworth Darby, Michael DeStefano, Barry Eichengreen, Campbell Harvey, Fred Hu, Xiaobo Lu, Christian Lundblad, Ailsa Roell, Daniel Rosen, Shang-Jin Wei, Jialin Yu, and Xiaodong Zhu. The book begins with an overview of the history of financial-sector development, regulation, and performance and then focuses on the banking sector, discussing the progress, challenges, and prospects of current sector reform. Subsequent chapters describe the role of foreign capital in China's development and analyze the changes in capital flows and controls over time; explore various explanations for China's composition of foreign-capital and foreign-exchange policies, particularly the factors shaping China's reliance on foreign direct investment; and provide an international, comparative perspective on the remarkable growth experience of China and the contribution of its institutional environment to that experience. Contributors dispute the belief that stock market listing has done little to reform state-owned enterprises and take a hard look at the exchange rate regime choice for China, considering the potential long-run desirability of flexibility and the appropriate sequencing of reforms in foreign-exchange policy, domestic banking reform, and capital-market openness. The book concludes with a roundtable discussion in which prominent economists, including Peter Garber, Robert Hodrick, John Makin, David Malpass, Frederic Mishkin, and Eswar Prasad, debate the pace of the appreciation of China's currency and the likely consequences of that policy within and outside of China.

An edited volume consisting of an introduction by the editors and eleven additional papers on China's financial system and financial sector reform. The papers originated at a conference on financial reform in China held at the John F. Kennedy School of Government, Harvard University, in 2001. They were then thoroughly revised and updated for publication.

THIS PATHBREAKING Work analyzes the evolution of China's financial reforms since 1979. China's reformers have stressed the construction of a more diverse, flexible, and competitive financial system as a crucial element of China's economic reform program. The authors assess the theory and practice of financial reform in light of China's specific characteristics as a large, developing country that still claims to be pursuing the goal of establishing a new form of "socialist" market economy. The authors utilize two approaches. First, they place the overall design and trajectory of. financial reform since 1979 within a broad comparative framework of alternative strategies of financial reform and financial systems. Second, they use a political economy perspective to explore the complex interactions among the political and economic actors— individual, group, or institutional—that affect reform outcomes. Integrating these two approaches, the authors conclude by assessing future directions for feasible and desirable financial reform in China.

As editors, first of all, we would like to thank the authors of this volume for their conscientious work that makes this volume possible. Many ideas in this book were first explored at an international symposium on financial market reforms in China, which was organized by the Chinese Economists Society. We would like to express our thanks to the sponsors of the conference: Center for International Business Education and Research, China Reform Foundation, MetLife, Hausman & Shrenger LLP, Lincoln National Insurance Company, City National Bank, Marshall School of Business, University of Southern California and The Chinese Economists Society. The Lincoln Foundation also provided generous support to this project through a grant made to Claremont Graduate University where this book was finalized.

The transformation of China's economy has involved major changes in the financial sector. This book offers a detailed and authoritative guide to financial reform in China since 1979. Bank loans replaced budgetary grants as the most important source of funds for investment. A two-tier financial structure, consisting of a central bank and a newly created specialised commercial bank, developed. Nonbank financial institutions also mushroomed. The book outlines the process of change, compares these changes to the earlier mono-banking system, and shows the problems which remained - including the lack of a proper financial control mechanism. There is a detailed case-study of the Shanghai financial markets.

Inhaltsangabe:Abstract: Generally speaking, economic growth is closely related to the efficiency of a country s financial markets. That is, the more varied the investment alternatives by which economic resources can flow within a country and between countries, the more efficient the financial market. This efficiency leads to a higher level of capital formation, and improved capital utilisation, thereby increasing the utility of both savers and borrowers and promoting economic growth. In line with its transition to a market economy China has, amongst other reforms, embarked on a reform of its financial system, transforming its one-bank monopoly into an integrated system of many banks and other specialised financial institutions. The resulting market complexity and the emergence of domestic and international competition gave rise to the marketing of financial services in China. Despite banks increasing marketing sophistication and higher spending on marketing, consumer behaviour is only beginning to react to it. On one hand the emergence of a wide variety of financial institutions and financial products has offset the impact of the social system reform on individuals lives. On the other hand, most Chinese still stay with one of the four wholly state-owned commercial banks, perhaps out of habit, perhaps from a feeling of security with their old banks. The effect on banks has been dramatic, service levels have improved greatly while product quality and variety have become better. However, the lack of market segmentation, partly due to government regulation, limits banks abilities to effectively target consumer groups, (which also hinders consumers information gathering and decision-making). Transformation of banking is hindered by China s poorly performing corporate sector, which strongly undermines banking profitability. China remains one of the weakest countries in terms of strength of the financial sector (Moody s), and the imminent WTO entry might result in disarray in the financial industry. Foreign banks with their sophisticated marketing have already put strong pressure on their Chinese counterparts, who are learning quickly. In the long run, the WTO entry and increased openness of the financial market will increase the competitiveness of the marketplace and enhance the development of the marketing of financial services in China. This dissertation will be divided into two parts. In the first part I will be talking about China s [...]