ID :
192645
Mon, 07/04/2011 - 08:26
Auther :
Shortlink :
https://oananews.org//node/192645
The shortlink copeid
China's smaller firms face bankruptcy wave: expert
By Kim Young-gyo
HONG KONG, July 4 (Yonhap) -- Many small and medium enterprises in China are feared to go bankrupt this year due to the country's continuous tightening moves, a Chinese industry group said Monday.
"Unless the government comes up with adequate measures, a wave of bankruptcy among small and medium-sized companies will possibly take place," said Li Zibin, president of the Chinese Small and Medium-Sized Enterprise Association. "It is impossible for those companies to survive on their own."
Li attributed the likely collapses largely to the Chinese central bank's recent policies to absorb liquidity in the market, as China has been facing persistent inflationary pressure amid its robust economic growth. Small and medium firms also suffered from rising wages, a labor dearth, a domestic power shortage and soaring prices of global commodities, he said.
"Due to the chain reactions after the financial crisis hit the world, China now needs to reform its industrial structure," he said.
Watchers said many small and medium-sized companies in China have been turning to pawnshops for quicker and easier money-borrowing services, even at much higher costs, as they are finding it difficult to get bank loans due to tight lending policies.
China's economic boom has recently shown signs of easing as the country continued its monetary tightening.
The People's Bank of China, the central bank, is seen to continue to maintain its tightening measures, as China's inflation keep rising. In May, China's consumer prices rose 5.5 percent from a year earlier to a 34-month high.
In April, the People's Bank of China, the central bank, raised the benchmark interest rate for the second time this year in a bid to curb rising prices. It has also hiked the deposit reserve requirement ratio for its major banks six times in 2011.
ygkim@yna.co.kr
(END)
HONG KONG, July 4 (Yonhap) -- Many small and medium enterprises in China are feared to go bankrupt this year due to the country's continuous tightening moves, a Chinese industry group said Monday.
"Unless the government comes up with adequate measures, a wave of bankruptcy among small and medium-sized companies will possibly take place," said Li Zibin, president of the Chinese Small and Medium-Sized Enterprise Association. "It is impossible for those companies to survive on their own."
Li attributed the likely collapses largely to the Chinese central bank's recent policies to absorb liquidity in the market, as China has been facing persistent inflationary pressure amid its robust economic growth. Small and medium firms also suffered from rising wages, a labor dearth, a domestic power shortage and soaring prices of global commodities, he said.
"Due to the chain reactions after the financial crisis hit the world, China now needs to reform its industrial structure," he said.
Watchers said many small and medium-sized companies in China have been turning to pawnshops for quicker and easier money-borrowing services, even at much higher costs, as they are finding it difficult to get bank loans due to tight lending policies.
China's economic boom has recently shown signs of easing as the country continued its monetary tightening.
The People's Bank of China, the central bank, is seen to continue to maintain its tightening measures, as China's inflation keep rising. In May, China's consumer prices rose 5.5 percent from a year earlier to a 34-month high.
In April, the People's Bank of China, the central bank, raised the benchmark interest rate for the second time this year in a bid to curb rising prices. It has also hiked the deposit reserve requirement ratio for its major banks six times in 2011.
ygkim@yna.co.kr
(END)
