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The Export-Import Bank of China (China Exim Bank) will provide stronger support for Chinese companies planning to invest in foreign countries.
Yang Zilin, president of the bank, said the institution would provide more long-term credit with lower interest rates for these companies in the coming year and help them explore more investment areas in foreign countries.
"The export and import banks in many foreign countries have put more emphasis on supporting companies investing in other nations, rather than sheerly supporting exports of commodities," Yang said.
Banks have enjoyed an enhancement of their role of supporting company investment in recent years as economic globalization sped up and international trade and international investment increased, he said.
As the country's only export-orientated policy bank, China Exim Bank will continue to support the export of electronics and machinery products and high-tech products while providing quality and highly efficient financial services for Chinese companies "going outward," Yang said.
China Exim Bank will expand loan services to Chinese companies that engage in processing trade or contract projects in foreign countries, he said.
"The bank will provide first-priority credit for export of equipment, technology and raw materials, which are demanded by overseas investment projects," he said.
The bank will also support Chinese companies engaged in project contracting, resource exploration and manufacturing business in countries where the Chinese Government provides preferential loans, he said.
"Helping domestic companies invest in foreign countries plays an important role in maintaining sustainable and healthy economic growth in China," Yang said.
China's fast economic growth during the past two decades has created huge opportunities.
But problems still exist, particularly insufficient demand and overproductivity of some industries.
In China, the annual production capacity of colour TV sets stands at more than 50 million, but domestic demand was about 25 million.
"This has resulted in fierce competition, which eats companies' profits," he said.
Potential solutions include government encouragement to domestic companies to invest in foreign countries, in addition to adjusting the economic structure and promoting the upgrade of industries.
Yang noted the time was basically ripe for domestic companies to "go out."
(China Daily February 10, 2003)
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