(DOWNLOAD) "Why Did the Rural Agricultural Cooperation Funds Fail? A Look at Changde, Hunan Province." by China: An International Journal # Book PDF Kindle ePub Free
eBook details
- Title: Why Did the Rural Agricultural Cooperation Funds Fail? A Look at Changde, Hunan Province.
- Author : China: An International Journal
- Release Date : January 01, 2006
- Genre: Social Science,Books,Nonfiction,
- Pages : * pages
- Size : 218 KB
Description
A modern economy needs financial institutions that facilitate the transfer of funds from people who save to those who have productive investment opportunities. (1) In China, this function is performed overwhelmingly by the banking system. In 1985, a new type of financial institution came into being--the rural cooperative funds (RCFs). They were simple depository institutions that basically took savings deposits from peasant savers and lent them to other peasants and town and village enterprises (TVEs) in the same local area. These institutions filled a gap that was not filled adequately by the existing financial institutions, and they showed great promise. However, many of the RCFs ran into serious problems, primarily with their loan portfolios, and in 1997 they were ordered closed by the central government. Many peasant depositors have never gotten their money back. (2) The RCFs were not able to survive in the Chinese environment, with its heavy-handed government interference, its abuse of power by the privileged and powerful at the expense of the depositors, and its seeming disregard of some basic principles of business and economics. As China strives to develop an efficient, diversified and durable financial system, the short, ill-fated history of the RCFs provides some object lessons. Setting up the RCFs