China to promote affordable finance as remedy for global growth at summit
World Bank estimated in 2014 that 2 billion adults had no access to the most basic services
China, as this year’s host to the Group of 20, will promote affordable financial services to low income groups as part of its efforts to reshape global economic growth.
Under China’s G20 presidency, a working group had drawn up proposals to promote digital and internet usage to offer “inclusive finance” to low-income groups, said Yi Gang, a deputy governor of the People’s Bank of China.
Following months of tight security, restrictions on logistics and orders to shut down nearby factories, China is doing whatever it can to window dress Hangzhou where the G20 leaders will meet next weekend.
It is expected to present its remedy for sluggish growth and structural reforms during the summit.
Lu Kang, a spokesman for the Ministry of Foreign Affairs, said on Friday that China would suggest that the summit draws up an action plan to achieve robust and sustainable growth and fight trade protectionism.
Inclusive finance would also be an important topic at the summit, Yi said. China is attempting to remedy the widening wealth gap in the global economy.
“As a G20 member, China’s concepts, experience and priorities in developing inclusive finance, were adopted and accepted when drawing up the principles,” Yi told a financial forum on Friday organised by Beijing’s Renmin University.
The proposals include principles and suggestions on how to provide inclusive finance through digital means, updates on how financial services are appraised, and guidelines to improve funding to small companies.
The World Bank estimates that there were 2 billion adults in 2014 who had no access to the most basic financial services.
“China has much experience that can be shared with other countries to develop inclusive finance,” said Yi, who has been involved in the reform of China’s rural financial institutions.
The G20 should also lend a hand to alleviate poverty in developing countries, particularly Africa and Latin America, Yi added.
China has also proposed that the G20 initiates a study of green finance jointly chaired by the central banks of China and Britain.
China International Capital Corporation (CICC), a leading domestic brokerage firm, said in a research note that China would also propose wider usage of Special Drawing Rights, an accounting unit of the International Monetary Fund, such as through SDR-denominated bonds in China.
“The efforts are expected to be acknowledged by the leaders at the summit and may be regarded as a part of reform to global currency regime,” CICC said.