The Agricultural Bank of China (ABC), one of the "big four" state-owned commercial banks, said Thursday it plans to injects 467 billion yuan (US$58 billion) in the next five years in support of the government's initiative to build the "Socialist New Countryside."

 

A spokesperson of the bank said Thursday that the "New Countryside" initiative is providing a big chance for commercial banks, as it is estimated that the initiative will gobble up some 20 trillion yuan (US$2.5 trillion) by 2020.

 

The Chinese government launched the "New Countryside" initiative in 2005, in a bid to promote the development of its vast rural areas, where 800 million of its 1.3 billion population live.

 

Though government will increase its spending on agriculture and rural development, an overwhelming majority of the funds shall have to be sourced from the banks, the spokesperson said.

 

As its name implies, ABC has traditionally focused its business in rural areas and small towns.

 

Currently the ABC has 6,389 outlets in county towns, and 8,672 outlets in smaller towns.

 

Compared with other banks, ABC's strength is its extensive coverage of the rural areas and its familiarity with farmers and agriculture, the spokesperson said.

 

While maintaining its shares in traditional services such as savings and deposits, settlements and small loans, ABC will try to improve its services to the rising number of agricultural corporations and leading local firms.

 

The ABC will also seek to improve its shares in high-end products such as long-term financing, international payment settlement, electronic banking, insurance brokerage and credit card services, the spokesperson said.

 

(Xinhua News Agency August 4, 2006)