| The Notification of guiding opinions on Loansof Assembling Business of Raw Material Processing Abroad Issued by the People's Bank of China and the Ministry of Foreign Trade and Economic Cooperation |
| Tuesday,October 08,2002 Posted: 15:01 BJT(0701 GMT) |
| To: all the branches of the People's Bank of China, Business Managing Departments, The Import and Export Bank of China, the state-owned commercial banks, other commercial banks, the foreign economics and trade commissions of all provinces, autonomous regions and cities under the direct leadership of the central government It is announced that: In order to support expansion of export , to raise the level of opening to the outside and to encouraging the following industries, such as, light industry, textile, electrical supplies for family use, mechanical and electronics and dress processing , to do the assembling business of raw material processing abroad the People's Bank of China and the Ministry of Foreign Trade and Economic Cooperation issued the loan guiding opinions for the assembling business of raw material processing abroad According to the notification issued by the Office Bureau of the State Council with the Documentation No.17 of OBSC,1999 . Now we distribute them to you. The relevant banks and foreign economics and trade departments must give the strong support to the assembling business defined by the government of raw material processing abroad and promote its development according to the needs of our policies of industry and foreign trade and efficiently protect the banks from funds risk. Appendix: the Loan guiding opinions of supporting the assembling business of raw material processing abroad Appendix The Loan Guiding Opinions of Supporting the Assembling Business of Raw Material Processing Abroad With the increase of our economic level , the improvement of economic structure and expansion of the cooperative relations of foreign economics and trade the assembling business of raw material processing abroad is becoming an major type of the foreign trade export and a new increasing point of expanding export In accordance with the main points of the notification issued by the Office Bureau of the State Council with the Documentation No.17 of OBSC,1999 we forward some opinions on loan supporting the assembling bisiness: 1. the Assembling business means that our domestic enterprises using our good technology and equipment and subsidiary materials suitable for use go abroad to run factories. Based on the way of processing and assembling abroad to help and expand the export of domestic equipment technology spare parts and raw materials all the commercial banks and the import and export banks of China must pay special attention to the positive role of the assembling business of processing in export expansion and promotion of the structure adjustment of our domestic industry. According to the needs of our policies of industry and foreign trade and efficiently protecting the banks from their funds risk the banks must give strong support to the assembling business defined by the government and promote its development. 2. the loan support to the assembling business of processing is that our industries, such as, light industry, textile electrical supplies for family use and mechanics, electronics and dress processing , have some priority in equipment and technology. 3. The subjects of the loan supporting are the enterprises approved by the government to do the assembling business and also accord with the following conditions: a. Obtain the approving certificate issued by MOFTEC of assembling enterprises of raw material processing; abroad; b. The enterprises have good business running with high management level and they can provide necessary guarantee of investment loans abroad; c. The assembling and processing program has good benefits and bright prospect and it has its stable cash flow and the ability of earning foreign currency which meet the needs of our country; d. The enterprises have a good bank credit records; e. Other conditions which accord with banks' demands. 4. If the enterprises accord with the conditions of doing assembling business, the banks may give them short, medium and long-term loans. The medium and long term loans are used for purchasing the equipment, technology and the equipment installation for setting up the factories in China. The limit period is over one year; the short term loan is mainly used for buying the raw materials, spare parts and the production charges in the assembling and processing business abroad so as to support the export and production of these products. The loan period is within one year ( one year ) the currency of the loan is mainly RMB If the program definitely needs foreign currency the banks may issue the short-term loan of foreign currency. Issuing and using the foreign currency loan and the remittance of foreign currency must accord with the regulations of foereign currency. If the loan is in a big amount the banks may ask the international financial group to help. Besides, the banks may take all kinds of ways to support the development of the assembling business according to real conditions. 5. the loan banks check the assembling business by themselves and give the loan and they must strictly control funds risk and protect the loan funds from risking. The banks may check the loan volume of the assembling business according to the daily current capital of the enterprises and its export scale and its ability of processing. The loan volume is examined once a year. And it also can be increased due to the special conditions. The loan funds used by the enterprises must be reviewed and verified by the banks one after another. They may simplify the procedure due to the situation. If our banks' branch is in the country which our assembling business is donewe may arrange the branch to do the loan business to the factory. If some enterprises need the letter of guarantee produced by the domestic banks, they should go to the managing department of foreign currency to handle the checking and approval of the guarantee and registration as well. 6. The loan interest rate of the assembling business must carry out based on the same rate stipulated by the government. The enterprises with good loan records and good business running and its processing program has good benefits, and having good guarantee of paying back the cost and interests, the loan interest rates may a little bit goes down within the stipulated scope. As for the medium and long-term loan of RMB and Foreign currency loan the central foreign trade development foundations may give them interests allowance. The details may work out afterwards. |
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