About one-third of China's 110,000 state enterprises are in red, surviving on state subsidies. In his annual report to the National People's Congress, Premier Li Peng said firms running at a loss for a long time and unable to repay their debts should go bankrupt or stop production and be reorganized. The project will begin with a payment system that will eventually link all the bank's offices and between 80,000 and 100,000 branches in one network. China will seek loans from World Bank and Asia Development Bank to finance the project. Approved by the Ministry of Finance, the NET system will underwrite 200 million yuan of the three-year tradable treasury bonds, allowing individual investors to buy the bonds without paying a commission to the brokerage.
Investors can open NET accounts in many brokerage firms for trading purpose.
According to the Bloomberg, China has published a new set of laws to encourage foreign companies to set up joint stock companies in China. The laws give priority to companies in the manufacturing and technology sectors. Issue Bonds Pinjie Seafood Co., Shanghai's largest private enterprise and a major source for seafood in the city, has become Shanghai's first private company to issue corporate bonds, according to Shanghai Securities News. Facing liquidity problems, the company issued five million yuan in six-month bonds, sponsored by Pudong Development Bank. Yang has worked in investment banking, insurance and legal firms in New York, Beijing and Hong Kong.