China's Parliament Reveals Major Ministry Plan

By Faith Magbanua, March 14, 2018 02:03 AM

China(Pixabay)

As part of the sweeping changes to its central government structure, China has said that it has plans to merge its banking and insurance regulators.

The proposed shake-up, along with the creation of numerous new ministries, was announced by the annual sitting of the National People's Congress (NPC) earlier this week.

The move aims to combine the insurance and banking bodies and is targeting at decreasing systemic risk in the financial sector.

The reformation of China's financial landscape has been a central task for Beijing; however, questions are still raised on what will happen after the merger.

For starters, the Banking Regulatory Commission (CBRC) will be combined with the China Insurance Regulatory Commission (CIRC) to form a super regulator, overseeing all of China's banking and insurance sector.

Some of their roles will be transmitted to the central bank - the People's Bank of China (PBOC) - which will take on responsibility for making new laws and regulations.

President Xi Jinping's top economic advisor, Liu He, said that the sweeping reforms would be "profound" and would help abolish inefficiencies across state agencies.

"Deepening the reform of the party and state institutions is an inevitable requirement for strengthening the long-term governance of the party," Liu stated.

What is the relevance of this particular issue to China?

The reforms are part of President Xi's strategies to strengthen the central government's control over the economy, crack down on the financial industry and guard against excessive borrowing and risk.

The increasing level of debt being carried by some Chinese firms, by state-owned enterprises and by local governments has been a widespread cause for concern for several years.

Central bank governor Zhou Xiaochuan said that the loopholes in the financial regulatory system needed to be closed and that flaws in regulations needed to be corrected in order to defuse financial risk across the sector.

On the sidelines of the NPC - the annual parliamentary meeting - last week, he said the PBOC would take the lead in coordinating those efforts.

In addition to that, as part of recent efforts to reduce financial risk in the country, Beijing took control over China's giant Anbang Insurance Group last month.

Anbang is well-known as one of China's richest and most opaque conglomerates. It's best known for its aggressive international acquisitions, including New York's Astoria Hotel.

 

Related Article

Must Read

comments powered by Disqus

More from CCD

Death Toll Rises to 256 in Indonesia Earthquake

New updates are reported regarding the latest earthquake that hit Indonesia.

Alibaba Plans to Merge China Food Delivery Businesses Ele.me and Koubei

Alibaba makes a move on the food delivery industry.

Little Jinju Has Gone to Heaven after Nearly 3-Year Struggle with Blood Disease

Aug 1, 2018, little Jinju passed away in a sudden in northern Shaanxi, her hometown, after having struggled with congenital blood disease for 2 years and 9 months.

The Truth About China’s Vaccine

What do we know about China's vaccine scandal?

Is Google Working on a Censored Search Engine for China?

Is it possible Google found a way to make its way in China and what will it mean?

Killer Heatwave to Sweep China By 2070

Check out how a heatwave can make massive problems in China once it arrives in 2070.

“China’s Nick Vujicic” Challenges to Climb Mountains to Glorify God

Zhang Wei, an ALS patient who is predicted by a doctor not to survive 18 after diagnosis, has succeeded in climbing two high mountains in the last two months.

US and China Fights Over $113M Asian Investment

The never ending economic fight between US and China has gotten a little bit worse, this time involving Asia.

Australian Archbishop Philip Wilson Resigns After Sex Abuse Scandal

One of Australia's top officials resigns after being convicted regarding his involved in covering up a sex abuse scandal in the church.