FOREIGN banks have seen increased demand for loans to fund projects in China since the Chinese Government introduced its credit-tightening policy.
Maurice Lee, project finance manager of Hongkong Bank China Services, said yesterday that investors unable to get funds from state-owned mainland banks were turning to foreign banks.
Hongkong Bank, one of the foreign banks allowed to offer non-yuan business in China, has five branches and four offices in the country.
Speaking at a conference on business co-operation between Hong Kong, Taiwan and the mainland, Mr Lee said the macro-economic control measures would not be suspended this year.
There have been suggestions that the austerity programme introduced by Beijing in the middle of this year would shortly be terminated, but Premier Li Peng reaffirmed yesterday that the macro-control measures were a long-term task.
Mr Lee said: ''It is difficult to predict how long the measures would persist. But if we look at the development this year, the objectives of the macro-control measures have yet to be achieved. So it is likely the measures will be carried over into next year.
''Because of the shortage of funds in China, foreign banks suddenly find themselves facing more demand for loans from many investors who have been turned away by state-owned banks.'' Mr Lee said the credit-control policy affected only state-owned banks' yuan business, and foreign banks' foreign currency lending was not directly affected.