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北京大学英语新闻网/Peking University News
President of People's Bank of China
gave a Speech at PKU
By Chang Huili
PKU NEWS 2004—02—21
http://ennews.pku.edu.cn/news.php?s=77506574
Peking University, Beijing, Feb 21st,2004: Dr. Zhou Xiaochuan, president of
People's Bank of China, gave a speech at BiMBA, Peking University under the name
of The Investment of Foreign Exchange and Disposition of Banks‘ Ill Loans tonight.
The hall was crowded with many students standing up, even though additional desks
and chairs had already been used. Students applauded loudly when Dr. Zhou
appeared.
Dr. Zhou started his speech with Enron Affair. He said that Enron Affair reflected the
necessary supervision that was absent from accounting companies. He also
mentioned Parmalat Affair and Argentinean financial crisis, both of which are related
with a rating company. From these three affairs, he concluded that the losses caused
by international financial organizations were finally estimated between the banks and
the investors of the company. Then he shifted his topic from abroad back to domestic
spectrum.
First, he said that the obstacle to the financial reformation was the low quality of the
national credit system while the establishment of social credit system was a long and
strenuous process. Moreover, responsibilities should be differentiated properly
among the financial system. Besides, companies offering financial service in China,
such as accountant companies and rating companies, had not developed well.
Although international companies had abundant experience, they did not know much
about the circumstances in China and their price was rather high. So we should
create favorable environments to accelerate the development of these companies.
Second, Dr. Zhou explained the disorder of companies‘ management was an
important reason for ill loans in China. As there is no board of directors in
state-owned companies, rating companies were employed by general managers for
the purpose of obtaining some funds. Then the results of rating were very
questionable and general managers could possibly cheat in getting a loan. To avoid
this, companies should have clear ownership and a clear definition of owners and
investors is necessary to the supervision of companies. Besides, the reformation of
companies should have specific goals and penalty should be made to guarantee the
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