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The so-called China's financial troika, China Bank Regulatory Commission (CBRC), China Securities Regulatory Commission (CSRC), and China Insurance Regulatory Commission (CIRC), are changing their leaders.
All three successors will face a series of challenges,
such as huge local debt, credit bubble burst, and distrust.
Many Chinese criticize these changes of appointment.
Commentators do not believe such changes will solve
any fundamental issues since the Chinese finance industry is only at the service of the communist party.
Reporter:
On October 29th, China announced Shang Fulin, the chair of China Securities Commission, has been appointed the chair of China Bank Regulatory Commission (CBRC).
Former chairman of Construction Bank, Guo Shuqing, was appointed chairman of China Securities Regulatory Commission (CSRC), and former head of the Agricultural Bank, Xiang Junbo, will serve as Chairman of China Insurance Regulatory Commission (CIRC).
Upon learning that the Governor of Calif. was coming to visit,
For a long time, collusion between officials and the businesses, and insider trading are widespread phenomena in China's stock market.
All three new finance directors have doctorate degrees, and are classified as the so-called scholar officials.
Media hope they will bring a turning point to the financial industry.
Chen Zhifei, a current affairs commentator, said that
China's finance is entirely controlled by the government.
The final decision maker is not the CBRC, CSRC or CIRC,
but the Leading Group for Financial and Economic Affairs constituted by a few Party Committee members.
The three newly appointed financial directors are not members of the Leading Group.
The CCP is in fact managing the finance as the party's business.
Chen Zhifei: "These CSRC, CBRC, CIRC key officials are only superficial.
They have somewhat dazzling degrees which,
in fact, will not have any effect on the institutional operation.
The highest party authority decides and
controls the economic policy based on the party's need."
National Audit Office data showed, as of the end of last year
(2010), local governmental debt was as high as 10.7 trillion yuan.
The Chinese "Reuters" indicated that risk associated with an underground financial system such as civil usury is another challenge the new directors must face.
On the other hand, the latest central bank data showed that
as of the end of September, the mainland's foreign exchange
reserve was up to 3.2 trillion U.S. dollars.
He Junjiao, the mainland enterprises observer, believes that
the recent real estate regulations have decreased local
government land revenue, therefore local governments are
allowed to issue bonds to bring in revenue.
He Junjiao: "I am very much worried. With such power (to
issue bonds), regarding how local government is going to
develop and pay back, I really don't have much confidence."
On the other hand, we have such strong foreign exchange
reserves, these valuable funds are used to support the U.S. and
to support economic development in Europe; that I really don't understand."
In addition, the CBRC will have to face the accounting scandals
of U.S. listed Chinese companies.
Previously, the British Financial Times-Chinese reported that
many of the overseas listed Chinese companies are accused of
fraud, accounting fraud or other problems.
Last year, there were at least 20 U.S. listed Chinese companies
that were either suspended or delisted by the New York Stock Exchange because of resignation of auditors or issues of accounting.
Chen Zhifei: "This exposes what appears to be a technical
problem on the surface, but in fact, it's a moral issue, it's a
common systematic problem under the rule of the communist party.
No matter if you have a Harvard degree, a number of
compelling titles, or some theoretical contribution,
with a total collapse of morale, there is no room for anyone
to display his intelligence."
Chinese media refer the new Banking Regulatory Commission Chairman Shang Fulin as a "supervisor of Chinese characteristics and political wisdom."
On the Internet, people who suffer from the mainland stock market interpret the statement as, "The Chinese characteristics of greed,
the political wisdom of autocracy."
Internet users mock that Shang Fulin has helped the Chinese stock market become the world's first during his term in China
Securities Regulatory Commission;
First in misappropriating, and first in falling stock.
NTDTV reporters Yi Ru, Li Qian and Ge Lei
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