China Boom Logo Center on china us relations
  • Viewbythread
  • Capitalism
  • Globalization
  • The Party
  • Crisis Management
Pre 1978 1978 1984 1985 1989 1990s 2000s Present

Prospects

  • Consumer Economy
  • Greening the Boom
  • Winners and Losers
  • The Politics of Growth
  • Making Room for China
Gradient Line

An iconic billboard in the quintessential boom city of Shenzhen features Deng’s famous statement that China's “basic line will not waver for 100 years.” If Deng was right, we are less than one-third of the way into the era of “reform and opening.” But four challenges identified by Premier Wen Jiabao in 2010, that growth becomes “unbalanced, unstable, uncoordinated, or unsustainable,” threaten the boom. The key to balance lies in increasing the consumer share of GDP, allowing China to create a modern consumer economy. Stability will depend on the government's ability to address grievances as the gap between winners and losers widens. Coordination is the great test facing the ruling Communist Party, of whether it can manage the politics of growth without fundamental changes to the system. Sustainability is an issue that has global implications, as citizens of a warming planet watch anxiously to see if China is successful in greening the boom. The fifth great challenge, left out by Premier Wen, may be the external one: whether the world is successful in making room for China.

A Government Monopoly on Finance Loosens

Period: Prospects | Winners and Losers

Your browser does not support the video tag.

Videosinthisperiod

Slideup
  • A Government Monopoly on Finance Loosens

    Mao Yushi

  • Women Hold Up Half of The Sky

    Song Bing

  • China's Intellectuals Aim for Social Justice

    Victor Yuan

  • Winners And Losers

    Ai Weiwei

  • Reform Transformed the Countryside

    Xu Xiaonian

Slideup
White Bg
Meettheexpert

Mao Yushi

Chairman, Unirule Institute of Economics

Mao Yushi, is the chairman of Beijing's Unirule Institute of Economics. In 1958, he was labeled a rightist and later was sent to labor at the Datong Locamotive factory during the Cultural Revolution. In 1975, he started research in Macroeconomics and in 1979 he worked out the mathematical method of the Principle of Optimal Allocation. Professor Mao currently holds various titles including: certified consultant for the Asia Development Bank; consulting editor for the China Economic Review; and Honorary Professor at Mineral College in Shandong, Foreign Language and Trade University in Guangdong, and Northwest University in Xi'an. Professor Mao has run a poverty alleviation mini-credit foundation in Shanxi since 1993, and a Vocational Training School since 2003 for rural girls seeking employment in Beijing.  Mao’s areas of research focus on institutional economics, energy and environmental economics, transportation, policies on economic reform and poverty alleviation.

Videotranscript
Caret

Click to expand

collapse transcript Closebigger

Microfinance in China is very underdeveloped for the moment. Compared to Bangladesh, we are very backwards. Financial services for farmers are very poor because the official financial institutions hoard their savings and do not grant any loans. In other words, the money from the farmers is used to build skyscrapers in the cities, or the Three Gorges Dam, therefore, the countryside is very poor. Their money has been taken from them. The absence of microfinance in China is due to the Chinese government's monopoly on finance. Unlike in the US, where thousands of banks are run by individuals, in China, not only in the countryside, but also in the cities, individuals are not allowed to do business in finance. All of the banks in China are run by the government. Individuals are not allowed to open a bank. Though I have done microfinance in the countryside for 16 years, it remains an illegal business. It is still an illegal business unit which is not under the protection of government law. It is actually an underground organization. Luckily, the government didn't regulate me. If they did, I could have been sent to the prison because it is an illegal business. There have, however, been some changes. The government is starting to allow private funds to provide financial services to businesses in the countryside. Even though it is a very tiny opening, there has been a capital inflow of 100 billion RMB to the Chinese countryside. This is a very important development in the reform of China's financial sector.

Add New Comment

comments powered by Disqus
Cite this Source >>
“A Government Monopoly on Finance Loosens | Mao Yushi | Prospects | The China Boom Project.”
The China Boom Project.
The Asia Society Center on US-China Relations.
1 June 2010.
Web.
09 May 2025.
<https://chinaboom.asiasociety.org/period/prospects/32/173>.
Map Sm

Map the interviews

Click on the map to see where inteviews took place

+
Map Threads Timeperiods Essays
Click map to browse videos by location.
Map Preview
  • Capitalism
  • Globalization
  • The Party
  • Crisis Management
  • Inheritance (Pre-1978)
  • Emancipation (1978-1984)
  • Reckoning (1985-1989)
  • Rebirth (1990s)
  • Overdrive (2000s)
  • Prospects
  • Mao's Failure, Deng's Success
  • China Boom: Rural China in the 1980s

Asia Society Center on U.S.-China Relations | 725 Park Avenue at 70th Street, NY, NY 10021