BIZCHINA / Top Biz News
'Time ripe for welfare reform'
(China Daily)
Updated: 2006-11-21 08:30
China's high savings rate and sound public finances offer the right
conditions for the authorities to proceed with social security and
healthcare system reforms, People's Bank of China Governor Zhou Xiaochuan
said.
Speaking to the Xinhua News Agency in Sydney, where he was attending a
Group of 20 meeting of finance ministers and central bankers, the head of
China's central bank said the nation's social security system should
include all members of society.
Social security fund reform should involve government support, individual
accounts and commercial insurance, Xinhua quoted Zhou as saying.
People with adequate savings should be encouraged to invest in personal
pension and medical insurance schemes, Zhou said, stressing that the
government should offer more support to poorer citizens.
The central bank governor said that pension funds, which are currently
mainly held by banks, should be invested in capital markets to increase
their value and generate higher returns.
The government is currently working on a plan to transfer 10 per cent of
any domestic shares in listed State-owned companies to the national
pension fund, the National Council for Social Security Fund.
The council, which had total assets of 230 billion yuan (US$29 billion)
at the end of August, currently invests mainly in bonds and bank deposits
and is planning to start overseas investment in the near future.
Zhou said the current healthy state of the nation's finances also offered
good opportunities for further steps to be taken in foreign exchange rate
reform.
He added that the nation's financial sector was now in a much stronger
position than it was three or four years ago, noting that it was now
better equipped to cope with interest rate reform and a more flexible
yuan.
In another development, the People's Bank of China announced yesterday it
had opened a representative office for the South Pacific in Sydney.
The office will improve communications with monetary authorities in the
region and promote financial co-operation, the central bank said.
(China Daily 11/21/2006 page9)
(For more biz stories, please visit Industry Updates)
Chinesepod
