Source: CCTV.com

12-19-2008 11:36

China will encourage individuals and companies to borrow more for consumption by setting up a nationwide credit system as part of its efforts to bolster domestic demand.

The Ministry of Commerce says the government will boost credit sales in selected cities on a trial basis.

The Ministry of Commerce says the government will boost credit sales in selected cities on a trial basis. It will also require banks, insurance firms, industry groups and credit rating agencies to improve cooperation.

The country will draft policies on credit insurance and credit guarantees as well as help companies to manage credit risks more effectively. China is on track to shore up domestic consumption to sustain its economic growth as exports dwindle amid the global financial crisis.

The government hopes credit sales which allow consumers to use borrowed money to buy good will boost the country's purchasing power. Companies will be able to improve their capital efficiency by using the credit. Currently, only about 3 percent of sales in China are made on credit, compared with about two thirds in the US.

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Editor:Xiong Qu