Dean Cheng Siwei made a trip to Wenzhou on April 19 and researched on the financial reform there. He said that financial reform should focus on service business and real economy, and three issues should be solved, that is, guiding the fictitious economy to support private economy, mobilizing private capital to real economy and serving foreign direct investment of individuals.
After hearing reports from the managing deputy mayor Peng Jia about recent reform and development, current economic and financial situations and the propelling of financial reform experimental area in Wenzhou, Dean Cheng went to Wenzhou Equity Operation Center for a research.
In his research, Dean Cheng confirmed the achievements of marketization and the development of private economy in Wenzhou. As for the financial reform, Dean Cheng indicted that the government should center on serving the enterprises and consider how to offer services to enterprises and the real economy through finance.
Dean Cheng pointed out that three factors would decide whether the financial reform would be successful or not. First, would the reform promote the real economy in Wenzhou? Second, would the reform mobilize the informal finance to support SMEs? Lastly, would the reform expand foreign investment channels?
In guiding the fictitious economy to support the real economy, the relationship between the two should be handled properly so that the fictitious economy will help the real economy and lower the risk caused by the fictitious economy. Fictitious economy can provide enterprises with capital for operation, serve for the tech innovation, equipment replacement and expanded reproduction of enterprises, and help enterprises to deal with external risks.
In mobilizing private capital to support small business, small financial institutions such as community banks and village banks should be founded. Measures such as deposit insurance and fluctuating rate of interest can be taken.
