context: The CPC launched its 20th third central inspection in April 2024, sending inspectors to oversee recent performances of the Party’s own financial watchdogs and institutions. Advancing sectoral growth jointly with political alignment is regarded as a basic requirement for new-era financial work. The campaign closed on 28 October, with Xi Jinping 习近平 denoting major defects that require reform. The following are sectoral rectification progress a year after the campaign.
Party Committees of PBoC (People’s Bank of China), CSRC (China Securities Regulatory Commission) and MoF (Ministry of Finance) all released reports detailing their progress of rectification following the third round of inspections, reports Yicai.
PBoC vowed to advance its mission and duty to promote high-quality development of the financial sector
- uphold the general principle of seeking progress while maintaining stability
- fully, accurately and holistically implement the new development philosophy
- foster a sound monetary and financial environment for sustained economic recovery
- strengthen duties for defusing financial risks and preventing systemic risks
- build secure, efficient and domestically controlled financial infrastructure
CSRC promised to accelerate a new round of capital market reforms per the Third Plenum decisions
- back new productive forces development
- deepen reforms of STAR Market, ChiNext and Beijing Stock Exchange
- streamline issuance and listing to cultivate ‘patient capital’
- further develop the bond marker
- advance futures regulation reform in Chinese-style
- expand high-level institutional opening-up to shore up attractiveness and competitiveness of PRC capital markets
- consolidate risk resolution, regulatory capacity and law enforcement
- coordinated development of investment and financing
- reform public mutual funds
- attract medium- and long-term capital into the market
- penalise violations per law and patch regulatory loopholes
- cross-agency mechanisms: sanction third-party collusion in fraud and advance full-cycle oversight
- expand measures to protect investors’ lawful rights
MoF assured that fiscal and tax reform will be advanced prudently, improving the PRC's financial management capacity
- greater efforts in
- resource and budget coordination
- zero-based budgeting
- refining local tax systems
- non-tax revenue management
- upgrade the transfer payment framework
- guide localities to
- advance fiscal management pilots
- higher standards of systematisation, precision, standardisation and rule by law
- balance security and development
- roll out new incremental debt support policies
- advance hidden debt swap
- reform and transform financing platforms
- investigate and hold accountable unlawful borrowing
- deepen special bonds management oversight
- ‘three guarantees’: basic livelihood, wages and operations
- closely assess and address factors affecting fiscal revenue and expenditure to ensure balanced budgets and stable fiscal operations
- advance fiscal management pilots
- deepen financial and accounting oversight: uphold financial discipline