Wen Jiabao criticizes failed banking reform
Beijing (AsiaNews/Agencies) Prime Minister Wen Jiabao has become very critical of Chinese banks as of late. He made is criticism quite clear after the Chinese government recently "rescued" two banks from crippling debt by pumping 45 billion US dollars in foreign exchange reserves into the state crediting institutions, funds which had recently accumulated thanks to a surplus in Chinese exports.
The government's "bail out" of the two banks should have led to their shares being publicly traded on the Chinese stock market, while first undergoing structural reforms to transform them from state-owned banks to ordinary, commercially-operated credit intuitions.
During a series of closed-door meetings in Beijing, Wen Jiabao accused the China Construction Bank (CCB), which is on its way to becoming China's number one bank, of not wanting to carry out structural changes according the constitution upheld by the bank's board of directors.
Both foreign and Chinese economists have criticized the CCB and Bank of China "bail out" operation. Many of them consider illegal the use of national funds to help financial institutions, without first gaining authorization from the National People's Assembly (NPA), which is scheduled to meet next week.
At the upcoming meeting some NPA representatives say they want to condemn the Assembly's choice, calling it "a step backward in terms of the law."
The issue is currently red-hot in the country, since the government is preparing to inject another 100 billion US dollars to bail out another two banks, the Industrial and Commercial Bank of China and the Agricultural Bank of China. (MR)
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