China plans to liberalize deposit rate in 2 years

China will liberate bank's deposit rate in one or two years, said Zhou Xiaochuan, governor of the central bank, in a press conference at the sidelines of the Second Session of the 12th National People's Congress Tuesday morning.

According to Zhou, liberating deposit rate is the last step in liberalizing interest rates. Initially, the interest rate will go up as the market will see more opportunities due to change in macro control and management style. However, the rate will strike a balance between supply and demand under the influence of market resource allocation and extensive competition.

China wants insurance to cover catastrophic events

Establishing an insurance system that covers catastrophic events is an important and urgent task for the Chinese government, said Xiang Junbo, president of the China Insurance Regulatory Commission.

Globally, about 30 to 40 percent of disaster losses are covered by the insurance system. However, the level is only about 1 percent in China.

For instance, the Wenchuan earthquake caused 845.1 billion yuan in direct economic losses, but insurance covered only 2 billion yuan, accounting for 0.2 percent, said Xiang.

The Chinese government has been planning to establish an insurance system that covers catastrophic events and has been pushing for legislation, said Xiang.

Two pilot projects have been prepared. One is in Yunnan province, providing property insurance to more than 500,000 rural households against earthquake. The other one is in Shenzhen, providing casualty insurance to every citizen against earthquake, typhoon and tsunami.