Launch of 2019 Tianfu Financial Index and Symposium on Financial Supply-Side Reform
2019-12-18 IMI
Ouyang Zehua, vice chairman of the CPPCC Sichuan Provincial Committee and director of Sichuan Local Financial Supervision Bureau, Xie Ruiwu, member of the Standing Committee of Municipal Party Committee and executive vice mayor of Chengdu Municipal Committee, Zhou Xiaoqiang, secretary of the Party committee of Chengdu Branch of PBoC and president of Sichuan Financial Academy, Liu Yuanchun, vice president of Renmin University of China, Han Xudong, vice president of China Fortune Media Group and chairman of Huaxin Financial Holding Asset Management Co., Ltd., Huang Yi, President of Sichuan Tianfu Bank, and other guests attended the launching ceremony.
He Qing, Professor of the School of Finance of RUC, interpreted the 2019 Tianfu Financial Index (TFFI). He pointed out that TFFI followed the “theory-based, policy-supplemented and practice-oriented” framework used in the previous two years, and evaluated the Tianfu Financial Index and its eight sub-indices in four municipalities directly under the central government, 26 provincial capitals (except Lhasa) and five cities with separate plans. TFFI gives full consideration to the different characteristics of traditional financial model and emerging financial formats, comprehensively reflects the influence of traditional financial model with four sub-indices namely “financial market”, “financial institutions”, “working environment” and “human resources”, evaluates the current situation of emerging financial formats with four sub-indices namely “science and technology finance”, “green finance”, “cultural finance” and “rural finance”, and introduces “consumer finance” and “digital inclusive finance” to observe financial sector. Tianfu Financial Index comprehensively reflects the overall situation and characteristics of the financial development of each central city. It is divided into three national financial centers and six regions to analyze the progress and shortcomings of the financial development of 35 cities. Therefore, it is of great significance to strengthen mutual understanding, realize healthier competition and coordinated development of each central city, and provides guidance for local governments to formulate targeted policies.
Yang Tao, assistant director of the Institute of Finance of CASS, and Li Jianjun, dean and professor of the School of Finance, Central University of Finance and Economics commented on the report respectively.
Yang Tao first elaborated his reflection on TFFI. He believed that the index of urban financial development needs to be objective, systematic and operable, and affirmed the Tianfu Financial Index in these aspects. To view Chengdu’s financial development behind TFFI, it is found that the rural financial development is well, but the development of rural industry and consumption is insufficient. TFFI shows that there is great competitive pressure on human resources and science and fintech, especially the latter one, which is more worthy of attention since its purpose is to promote the development of science and technology enterprises and progress of science and technology, and it is also an important source of long-term economic growth. Then, Yang Tao proposed that the core of financial supply-side reform in the future is to properly manage risk and security. We need to get rid of the debt-growth dilemma; strengthen the financial system to ensure financial security; comply with the needs of the new economy and effectively serve entities; and adhere to the principle of opening up and win-win cooperation. Finally, with regard to future development, Yang Tao believes that under the framework of financial index, financial supply-side reform and local financial development need to grasp typical elements such as talent, technology, data, scenario, capital, industry, supervision, policy, hardware and financial culture.
Li Jianjun mainly commented on the function positioning, characteristics and suggestions of TFFI in five major points. First, TFFI and China Financial Center Index (CFCI) have different functions. TFFI aims to guide the central cities to achieve healthier competition and coordinated development in the process of establishing regional financial centers, and its positioning reflects the policy guidance. Second, TFFI embodies the trend that financial sector should serve real economy. Third, TFFI has more connotations and diversified system. Fourth, the design theory and method of TFFI are comprehensive, takes into account both the traditional financial principles such as financial development theory and regional financial theory, and national financial policy and industrial policy as the guide. Fifth, with regard to improving TFFI, he proposed the following suggestions: first, appropriately increase the indicators to measure the satisfaction of financial consumers; set up reverse indicators to reflect the effect of financial risk prevention. Second, the some indicators need to be reconsidered, the particularity of which in urban financial development needs to be taken into account. Third, the frequency of TFFI release should be increased to let it better play a leading and referential role.
After the launching meeting, the Symposium on Financial supply-side Reform and Roundtable on Money and Finance Chengdu Summit was held. Liu Yuanchun, vice president of Renmin University of China, and Zhou Xiaoqiang, Party Secretary of Chengdu Branch of PBOC, attended the forum and delivered keynote speeches.
Liu Yuanchun delivered a speech entitled “Financial supply-side Reform is the Approach to Improve Financial Adaptability”. Liu Yuanchun stressed that in an era of great transformation, upgrading, innovation, and opening up, financial adaptability needs to be improved from several aspects: first, the structural and aggregate perspective required by the transformation; second, the adaptability between industrial upgrading, mass entrepreneurship, mass innovation and the financial system; third, the financial adaptability in the era of great opening up; fourth, the financial adaptability in the period of long-term stagnation of the global economy and China’s economic breakthrough.
Zhou Xiaoqiang put forward that: first, deepening the structural reform of the financial supply-side is of great significance. It is the objective requirement for financial services to serve the real economy, the necessary financial support to promote the supply side reform, and the fundamental strategy to prevent and resolve financial risks. Second, to deepen financial supply-side reform, we need to focus on four aspects of financial services, specifically including the insufficient development of direct financing in the financial market, the inadequate services for private SMEs, the low quality of financial innovation and the lack of financial service capacity of small and medium-sized banks. Third, to deepen financial supply-side reform, we should adhere to the new development visions, strengthen the function of financial services, and serve the real economy and people’s life with higher quality. Among them, innovation is the first driving force, which should be further deepened in the future to promote the optimization of the financial system and the improvement of service efficiency; coordination is the internal requirement, which should be guided by market demand, and we should actively build a multi-level, widely-covered and differentiated financial institution; green is an important foundation, which means that we should vigorously promote sustainable economic development; opening is the only way to further promote two-way opening and better support the related financial services of Belt and Road Initiative; sharing is the fundamental goal, which means we should develop inclusive finance, thoroughly implement the strategy of precision poverty alleviation and rural revitalization, and deepen the financial services of private and SMEs.
Then, the guests conducted a roundtable discussion on the topic of “financial supply-side reform to promote high-quality economic development”, chaired by Guan Wei, professor of the School of Finance and executive director of Credit Management Research Center of RUC. Participants of discussion include: Zeng Gang, deputy director of National Institution for Finance and Development, Fang Xin, vice president of Chengdu Branch of PBoC and executive vice president of Sichuan Finance Academy, Zhao Xijun, associate dean and professor of School of Finance of RUC, Zhou Yinggang, associate dean of Wang Yanan Institute of Economics and Professor of Department of Finance of Xiamen University, Tu Yonghong, deputy director of IMI and Professor of School of Finance of RUC, and Wang Qing, director of China Financial Research Center, Southwest University of Finance and Economics.
Zeng Gang pointed out that financial supply-side reform is a long-term process, which needs a long time and institutional construction. Fang Xin shared three thoughts: first, from the diversity and complementation of financial institutions, he proposed that small and medium-sized banks such as city commercial banks should deepen their reform; second, financial contracts should realize the differentiation and adaptability of financial products under the consideration of the balance of income and risk; third, they should realize the normalization of bankruptcy mechanism, make good use of it, straighten out our national economic metabolism, and improve the quality of economic development. According to Zhao Xijun, the multi-level capital market system framework has been built, but it also faces problems and challenges. In the future, there is still much to be done: first, all levels of the capital market should be better coordinated and linked; second, the opening to international market of our capital market should be improved; third, investors’ interests should be better protected. Zhou Yinggang believes that it is more appropriate for financial supply-side reform to increase cash flow than to reduce the valuation of fixed assets such as properties. The new land supply is changed from the leasehold system to an annual leasehold system, and sustainable cash flow is obtained by activating the stock, and systematic financial risks are gradually solved through deleveraging. Tu Yonghong believed that high-quality development and RMB internationalization complement each other. He also put forward the process, main challenges faced and the key work of RMB internationalization. Wang Qing pointed out that in the new era, the connotation of financial supply-side reform includes adaptability, compatibility and universality. Fintech is the tool to promote financial supply-side reform, which can be used in the field of inclusive finance, but will also cause the division of financial institutions. Although fintech is not omnipotent, it enjoys broad prospects. In the meantime, new risks should also be taken into account.
