Financial Services Talking Points | 28/11/2017

In today’s talking points: Slowing demand for Australian homes among Chinese buyers, says RBA; China to cut import tariffs; Financial technology to enhance SMEs; Policy sources say China’s expected to maintain its growth target in 2018

Slowing Demand for Australian homes among Chinese buyers, says RBA

Foreign demand for property has become a touchy issue with elevated house prices and complaints that Australians are not able to afford their first homes. Jonathan Kearns, the Reserve Bank of Australia’s (RBA) head of financial stability, said “foreign buyers accounted for about 10 to 15 per cent of new construction, or about 5 per cent of total housing sales and around one-quarter of newly built apartments.” However in the past few months, due to tighter controls on Chinese capital imposed by Beijing and tougher constraints on mortgage loans by Australian banks, the Chinese demand for Australian residential property has gradually slowed down.

Read more at: Sydney Morning Herald

China to cut import tariffs

From the beginning of December, China will cut import tariffs imposed on 187 consumer products from a range of industries including food, health and fashion. The move comes following a number of scandals surrounding domestic products, resulting in increased demand for international brands. Experts suggest that the cut will force local suppliers to compete more actively with these international brands, which the Ministry of Finance hopes will encourage consumers to spend more domestically, benefiting the economy. The move also appears to further open the economy to international corporations in the face of past complaints of unfair trade practices.

Read more at: BBC

Financial technology to enhance SMEs

China’s innovative financial technology will drive growth of small and medium-sized businesses in the Asia-Pacific Region, according to one FinTech business leader. Tang Ning, founder and CEO of CreditEase, said technological advancements will help the economy through improved financial efficiency. “The growth of fintech companies in the Asia-Pacific economies will keep momentum in the coming years, especially focusing on helping raise funds for small-scale businesses,” he told China Daily. “After the rapid development over the past decade, Chinese fintech firms, which mainly offer online payments, online transaction and P2P lending, have entered a mature stage, thanks to the backing of some global leaders such as Alibaba and Tencent. They can be seen as examples of fintech success.”

Read more at: China Daily

Policy sources say China’s expected to maintain its growth target in 2018

China is tipped to keep this year’s growth target of “around 6.5 per cent” in 2018, policy sources have told Reuters. It comes as officials are likely to meet next month for the annual Central Economic Work Conference. According to one source, who is involved in internal policy discussions, “next year’s growth target could be similar to this year’s”. “It’s OK as long as we are able to secure growth of 6.5 percent,” they told Reuters. At the Communist Party Congress in October, President Xi Jinping said China has to resolve “major risks” in the economy. However, the growth target also needs to be around 6.5 per cent for the next three years, to keep China’s progress on track.

Read more at: Yahoo Finance