China’s central bank, the PBoC, launched a set of policies last week to shore up financial services for small and micro enterprises. It announced 30 supportive measures, such as lower costs and faster growth of credit while encouraging financial institutions to raise more funds from the bond market. The target of net financing from corporate bonds this year is set at RMB 1 trillion (more than that of 2019). Financial institutions shall issue special bonds of at least RMB 300 billion for supporting small and micro companies, among other measures to serve SMEs financial needs.
China will set up a special transfer payment mechanism to ensure that this year’s newly increased fiscal funds can directly benefit businesses and the people. Green lights are given to a host of supporting arrangements on Tuesday at the State Council's executive meeting, chaired by Premier Li Keqiang. This year, the government will reduce tax and fees on enterprises by RMB 2.5 trillion (USD 353 billion).
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