"We've got 48 underwriting firms to provide bank loan services to SMEs with lowered interests and commission fees, and a series of activities will be held between banks and enterprises to ease their difficulties," said Yu Zhongping, director of Wenzhou Economic and Information Commission.One thing I have to say, the Chinese don't mince words. "Control the risks of private lending". Capitalism is not a sacrosanct religion there (yet) and that creates some refreshingly straightforward statements.
He said more measures will also be carried out to monitor and control the risks of private lending.
In addition, the city government has organized 25 teams to work with 25 banking organizations to examine the lending system for SMEs to prevent a collapse of the money chain.
"We aim to regulate the private financial market by organizing and expanding more authorized financial companies offering loans in the near future," said Zhang Zhenyu, Wenzhou's finance director.
Can they make a difference? That's the question. As the article points out 76 out of 855 surveyed companies said they were nearly out of cash. Other articles are cite a Wenzhou Small- and Medium-sized Enterprise Development Association warning that 40% of Wenzhou's SMEs will be out of business by Spring Festival. Wenzhou is not a backwater, it is the export engine of China. The world's shoes, sunglasses and lighters come from there.
As a result, it's going to make a useful predictor for the knock-on effects of a broader China collapse. As a supplier to the U.S., much less so a buyer from, how does the U.S. economy adapt to this shift? A desperate supplier is generally a more profitable economic partner, at least in the short term, medium term after failures the negotiating position can shift back to the supplier. It will be useful to watch what becomes of Zhejiang Center Group, if someone (probably backed by the state) picks up the business. Annual production of 20 million eyeglasses is certainly to go missed on the world market.