A survey of bank managers working in the operation and credit risk department at different hierarchical levels of individual commercial banks in China responsible for bank credit analyses and risk evaluations covering the procedure from loan application to final decision. The objective is to understand the internal organization arrangement of Chinese commercial banks in the provision of bank credit to SMEs. The focus is on the incentives and constraints faced by branch managers in the interaction with SMEs. The enquiry reflects the notion that the branch manager who directly interacts with the SME borrower plays a critical role in the information collection and processing in the lending decision. The incentives and constraints faced by branch manager are shaped by the type of organization of the bank: the degree of decision-making centralization, modes of communication between hierarchical levels, and the adoption of statistical techniques for risk evaluation.

The Chinese financial system has served the Chinese economy well in the early stages of development in channeling domestic savings to domestic investment. But, continued financial repression, along with a growing middle class and ageing population has created pressure on savings to 'search for yield'. At the same time, the dominance of lending to state-owned-enterprises, political constraints, inefficiencies and weak risk management practice by financial institutions (FI) have pushed SMEs to alternative sources of funding. The demand for yield from savers and funds from private investment has been met by the rapid growth in shadow banking.

This study encompasses two of the identified themes of the research call. The research theme 'alternative strategies for reform and liberalization' covers the role of the Shadow Bank system in the credit intermediation process. This research is of critical importance because it informs the macroeconomic research necessary for investigating 'the role of the Chinese financial system in sustaining economic growth'. Addressing the first research theme we take a dual track approach to better understand the role of the financial system in sustaining in economic growth. The first track examines the role of bank and non-bank finance in promoting long-term economic growth at the regional level. The second track is aimed at the more short-term issue of identifying the potential frequency of macro-economic crises generated by a banking crisis.

The finance-growth nexus is a well-established area of economic development, however the China experience questions the supposition that financial development is a necessary precondition. The empirical findings are mixed. Part of the reason for this could be the failure to distinguish between the quality of financial institutions across regions, and the openness of the local environment in terms of the balance between private and public enterprises. Our research would build on the existing literature in two ways. First, it would utilise imperfect but available data on informal finance to examine direct and spill-over effects on medium term growth from contiguous provinces. Second, primary data on the geographic dimension in shadow bank lending gleaned from Theme 2 research will be used to design a weighting system to adjust financial flows for the quality of the local financial environment. The second prong will develop a small macroeconomic model of a hybrid DSGE type that incorporates a banking sector including shadow banks.

Such models have been developed for China in recent times but only a few have attempted to incorporate a banking sector. These models are mostly calibrated versions and make no attempt to test the structure against the data. Recent attempts to test a hybrid New Keynesian-RBC DSGE type model for the Chinese economy using the method of indirect inference have been successful and inclusion of a shadow banks have shown some success. The results of the Theme 2 study will inform the development of a fuller shadow banking sector in the macroeconomic model that will be used to estimate the frequency of economic crises generated by bank crises. Theme 2 research will examine the relationship between the banking system and the shadow banking system as complements or substitutes. It will aim to determine the variable interest rate on the P2P online lending platform on the basis of risk-return, the home bias in online investments, and the signaling and screening in the P2P online lending platform. Finally, it will aim to identify the impact of shadow banking on entrepreneurial activity, the industrial growth rate and regional housing investment and price differentials. These results would inform the theme 1 research on the interconnectedness of shadow banking with the mainstream and the fragility of the financial system to shocks and financial crises.

Since the 2011 Financial Sector Assessment Program (FSAP), China’s economic growth has remained strong, although a necessary economic transformation is underway. China now has the world’s largest GDP in PPP terms, and poverty rates have fallen. However, medium-term growth prospects have moderated. The limits to the investment-driven growth strategy, combined with an aging population, waning dividends from past reforms, and a challenging external environment, have necessitated a transformation towards a more market-oriented economy that is more consumption-based, more services-driven, less credit-dependent and, especially, more efficient. This transformation has already started, as the Chinese authorities are increasingly emphasizing the quality of growth and have pushed structural reforms. The economic transformation requires a fundamental change in the role of the financial system. Historically its role was to channel China’s high savings at low cost to strategic sectors. China’s economic rebalancing is multi-dimensional, and there is a need to significantly improve the financial sector’s capital allocation to promote the rebalancing from investment to consumption; from heavy manufacturing to services; and from large to small enterprises. Looking ahead, the financial system will need to become more balanced, sustainable and inclusive, to facilitate China’s economic transformation, where markets play an increasingly dominant role in resource allocation and where consequences of risk-taking are well-understood and accepted. Maintaining financial stability would also require that remaining gaps in regulatory frameworks be addressed. The standard assessments for the banking, insurance, and securities sectors show a high degree of compliance with international standards, but also point to critical gaps. Themes that cut across China’s regulatory agencies include a lack of independence, insufficient resources for supervising a large and increasingly complex financial sector, and inadequate interagency coordination and systemic risk analysis. The remaining priorities for financial market infrastructure oversight include the adoption of full delivery-versus-payment and a stronger legal basis for settlement finality. Further enhancements to crisis management frameworks are needed to allow financial institutions to fail in a manner that minimizes the impact on financial stability and public resources. This would require amongst others greater emphasis on financial stability rather than social concerns in dealing with real and potential crisis situations, the introduction of a special resolution regime for failing banks, and a streamlining of the current system of financial safety nets.

The Global Financial Crisis (2007-2008), which began due to the collapse of the U.S. housing market, had a negative effect in many regions across the globe. The global recession which followed the crisis in 2008 and 2009 showed how interdependent and synchronized many of the world's economies had become, with the largest advanced economies showing very similar patterns of negative GDP growth during the crisis. Among the largest emerging economies (commonly referred to as the 'E7'), however, a different pattern emerged, with some countries avoiding a recession altogether. Some commentators have particularly pointed to 2008-2009 as the moment in which China emerged on the world stage as an economic superpower and a key driver of global economic growth. The Great Recession in the developing world While some countries, such as Russia, Mexico, and Turkey, experienced severe recessions due to their connections to the United States and Europe, others such as China, India, and Indonesia managed to record significant economic growth during the period. This can be partly explained by the decoupling from western financial systems which these countries undertook following the Asian financial crises of 1997, making many Asian nations more wary of opening their countries to 'hot money' from other countries. Other likely explanations of this trend are that these countries have large domestic economies which are not entirely reliant on the advanced economies, that their export sectors produce goods which are inelastic (meaning they are still bought during recessions), and that the Chinese economic stimulus worth almost 600 billion U.S. dollars in 2008/2009 increased growth in the region.

Additional file 1: Spearman correlation matrix.

The global financial crisis, triggered by the 2007 subprime mortgage crisis in the United States, has severely affected financial systems and real economies worldwide, leading to the most serious economic recession since the Great Depression of the 1930s. Behind these two economic recessions, despite different historical contexts and approaches to problem-solving, there are common characteristics associated with the mutual impact of financial crises: the essence of a financial crisis lies in financial instability, reflecting the fluctuations in asset prices. In addition to these two severe financial crises, financial crises of varying scales have occurred intermittently internationally. Considering the past and present, people need to think deeper about how to prevent such crises from happening again, especially mainstream macroeconomic thinking that has far-reaching effects should be reassessed.

This paper employs the mixed-frequency Granger causality test, reverse unconstrained mixed-frequency data sampling models, and Chinese data from January 2006 to June 2024 to test the nexus between consumer confidence and the macroeconomy. The results show that changes in the real estate market, GDP, and urban unemployment rate are Granger causes of consumer confidence. In reverse, consumer confidence is a Granger cause of the CPI. Second, GDP and the real estate market (CPI and urban unemployment rate) have a significant positive (negative) impact on consumer confidence, while the conditions of industrial production, interest rate, and stock market do not. Third, the “animal spirits” extracted from consumer confidence cannot lead to noticeable fluctuations in China’s macroeconomy. This suggests that the “animal spirits” will not dominate economic growth, even though they affect the macroeconomy slightly and inevitably. The results are robust after replacing the dependent variable and considering the influence of the global financial crisis and the COVID-19 pandemic.

The dividend for China Merchants Bank shares in 2023 was **** Chinese yuan, a slight increase to the year prior. Dividend payments had been increasing since 2010. The sharp increase in the year could be explained by the recovery of the impact of the financial crisis.

This paper employs the mixed-frequency Granger causality test, reverse unconstrained mixed-frequency data sampling models, and Chinese data from January 2006 to June 2024 to test the nexus between consumer confidence and the macroeconomy. The results show that changes in the real estate market, GDP, and urban unemployment rate are Granger causes of consumer confidence. In reverse, consumer confidence is a Granger cause of the CPI. Second, GDP and the real estate market (CPI and urban unemployment rate) have a significant positive (negative) impact on consumer confidence, while the conditions of industrial production, interest rate, and stock market do not. Third, the “animal spirits” extracted from consumer confidence cannot lead to noticeable fluctuations in China’s macroeconomy. This suggests that the “animal spirits” will not dominate economic growth, even though they affect the macroeconomy slightly and inevitably. The results are robust after replacing the dependent variable and considering the influence of the global financial crisis and the COVID-19 pandemic.

data for financial development and emission

The graph shows national debt in China related to gross domestic product until 2024, with forecasts to 2030. In 2024, gross national debt ranged at around 88 percent of the national gross domestic product. The debt-to-GDP ratio In economics, the ratio between a country's government debt and its gross domestic product (GDP) is generally defined as the debt-to-GDP ratio. It is a useful indicator for investors to measure a country's ability to fulfill future payments on its debts. A low debt-to-GDP ratio also suggests that an economy produces and sells a sufficient amount of goods and services to pay back those debts. Among the important industrial and emerging countries, Japan displayed one of the highest debt-to-GDP ratios. In 2024, the estimated national debt of Japan amounted to about 250 percent of its GDP, up from around 180 percent in 2004. One reason behind Japan's high debt load lies in its low annual GDP growth rate. Development in China China's national debt related to GDP grew slowly but steadily from around 23 percent in 2000 to 34 percent in 2012, only disrupted by the global financial crisis in 2008. In recent years, China increased credit financing to spur economic growth, resulting in higher levels of debt. China's real estate crisis and a difficult global economic environment require further stimulating measures by the government and will predictably lead to even higher debt growth in the years ahead.

Yearly citation counts for the publication titled "A Comparative Study on the Competitiveness of Major Shipping Ports in Korea and China after the Global Financial Crisis".

A decade after the global financial crisis, the U.S. banking sector has not only resurrected, but also stands more resilient with an all-time high equity to assets ratio and return on average assets since 2000. In addition, the continuous decline in non-performing loans by the U.S. banks from more than *% during the financial crisis to the current level of *% is nothing but a testimony of good times. Thus, Statista’s forecast on the industry revenue surpassing the *** billion mark by 2021 comes as no surprise. Technology adoption is changing industry dynamics The global banking sector has been one of the most aggressive adopters of digital technologies, with investments in the Fintech industry having registered an almost ***% increase over the period 2013-2018. Notably, the U.S. stands next to China in terms of adopting fintech in banking and payments sector. Interestingly, banks have also begun teaming up with Fintech startups to improve and expand their service offerings. In retail banking, online lending platforms and mobile banking usage is on the rise. Robo advisors opened wealth management to mass market Fintech pioneers such as PayPal have transformed the way payments are made globally. At the same time, robo advisory services have transformed the wealth management segment and opened new business avenues to attract mass-market customers who have limited assets to invest.

CWT plots comparison of the COVID-19 and the GFC.

Revenue for the Residential Real Estate industry in China is expected to decrease at a CAGR of 9.8% over the five years through 2025. This trend includes an expected decrease of 9.6% in the current year.Since August 2020, the People's Bank of China and the China Banking and Insurance Regulatory Commission have proposed three debt indicators for real estate development and management companies through which the company's financial health can be rated. This new policy has exacerbated the company's debt pressure, making it unable to repay old debts by borrowing new debt. Some real estate companies faced a liquidity crisis.In 2022, the city's lockdown and laying-off caused by COVID-19 epidemic led to the pressure of delaying the delivery of houses. The industry's newly constructed and completed areas decreased significantly throughout the year. In addition, the epidemic has impacted sales in the industry, and some sales offices have been forced to close temporarily. In 2022, the residential sales area decreased by 26.8%, and the residential sales decreased by 31.2%.Industry revenue will recover at an annualized 0.7% over the five years through 2030. Over the next five years, the industry's drag on GDP will weaken, and industry growth will stabilize. However, high housing prices have become a major social problem in China. Under the measures on the principle that residential real estate is used for living, not speculation, the financial attributes of real estate will gradually weaken, and housing prices will tend to stabilize.

In 2024, China’s level of total investment reached around 40.4 percent of the gross domestic product (GDP). This value is expected to remain stable in 2025 and increase slightly in the following years. Final consumption accounted for 55.7 percent in 2023. International comparison of total investments The GDP of a country can be calculated by the expenditure approach, which sums up final consumption (private and public), total investment, and net exports. The ratio of consumption to investment may vary greatly between different countries.Matured economies normally consume a larger share of their economic output. In the U.S. and many European countries, total investment ranges roughly at only 20 to 25 percent of the GDP. In comparison, some emerging economies reached levels of 30 to 40 percent of investment during times of rapid economic development. Level of total investment in China China is among the countries that spend the highest share of their GDP on investments. Between 1980 and 2000, 30 to 40 percent of its economic output were invested, roughly on par with South Korea or Japan. While the latter’s investment spending ratio decreased in later years, China’s even grew, especially after the global financial crisis, peaking at staggering 47 percent of GDP in 2011.However, returns on those investments declined year by year, indicated by lower GDP growth rates. This resulted in a quickly growing debt burden, which reached nearly 285 percent of the GDP in 2023, up from only 135 percent in 2008. The Chinese government defined the goal to shift to consumption driven growth, but the transformation takes longer than expected.

Figure 3 depicts China-Africa trade from 2000 to 2013. It shows that China-Africa trade consistently grew since the formation of the FOCAC in 2000. As can be seen in the figure, the US trade with Africa declined after the 2008 global financial crisis, allowing China to take the lead as Africa's largest trading partner. Figure 7 shows trade between China and Africa from 2003 to 2021. Although with fluctuations, trade between the two sides has been increasing since the establishment of the FOCAC mechanism. It reached a first high of US$203 billion in 2015 and then declined significantly the following year. However, the trade increased again from 2017 and surged to US$254 billion in 2021, up by 35% from the previous year. The high trade volume in 2021 has been attributed to the additional Chinese exports of Personal Protective Equipment (PPEs), such as masks and hazmat suits, as well as pharmaceutical products and testing equipment for the COVID-19 pandemic to Africa. However, Gu et al (2022: 11) indicated that the strong increase in China-Africa trade volume in 2021 is remarkable as data from China's customs agency shows that it is "made up of an increase in both Chinese exports to Africa (29.9% year-on-year) and African exports to China (43.7% year-on-year)". Figure 4 shows the number of countries around the world that have joined China's Belt and Road Initiatiative (BRI). As can be seen in the figure, China's BRI has attracted more than 140 countries. In Africa, the first countries that signed up for the BRI project were East and North African countries such as Kenya, Djibouti, Tanzania and Egypt. In Figure 5, the map shows the number of African countries that have signed up for the BRI since 2015. As can be seen in the figure, 52 countries in Africa had signed some BRI-related Memorandum of Understanding (MoU) with China by 2022.

Table 1 shows that studies that analysed the China-Africa relationship focusing on their 'strategic partnership' are very few, given the voluminous literature on China and Africa. A search of Sino-Africa studies conducted in English with the term 'strategic partnership' in their titles produced only ten papers (see table). Furthermore, as the table shows, studies investigating the increased security cooperation in China-Africa relations conducted in English are rare, although this part of the debate has also produced numerous research publications. The column titled 'Focus of study' in Table 1 above shows that majority of these studies concentrated on analysing economic cooperation, while a few also included political relations between China and Africa. Also, the column titled 'Definition of strategic partnership' shows that, all these studies, except Akpan and Onya (2018), made no attempts to define the concept of strategic partnership. Figure 8 shows the countries around the world in which the United Nations (UN) has deployed its peacekeepers. As shown in the figure, the UN has deployed several peacekeeping missions around the world since the late 1940s, with most of these operations taking place in the African continent. Figure 9 focuses on the UN’s peacekeeping operations in Africa. As can be seen in the figure, Chinese peacekeeping troops were deployed in five out of the seven UN-led missions on the African continent as of 2019. Figure 12 shows the foreign military bases that currently exist in African countries. As the figure shows, the African Continent is a host to 47 known foreign military bases, of which 34 are United States (US) bases. Figure 13 shows the foreign military bases in Djibouti. As seen in the figure, Djibouti hosts the US' Camp Lemonnier military base, just 13.4 kilometres away from the Chinese PLA's new navy facility, along with military bases of other major powers such as France, Germany and Japan in close proximity. Djibouti thus found itself in the middle of diplomatic tensions between China and the US over fears of a Chinese takeover of the Doraleh Container Terminal, Djibouti's main container port, in 2018, as China financed the development of the port. Figure 6 shows China's Forum on China-Africa Cooperation (FOCAC) commitments from 2006 to 2021. As can be seen in the figure, China's financial pledges to assist Africa increased from US$5 billion to US$60 in 2015. However, they dropped to US$40 billion in 2021. Further, drops in the number of activities, such as official development assistance (ODAs) and capacity building, including reductions in security collaborations, were also noted. However, a new development was China's reallocation of US$10 billion of its Special Drawing Rights (SDRs) towards Africa from the US$40 billion that it received from the International Monetary Fund (IMF).

From the Summer of 2007 until the end of 2009 (at least), the world was gripped by a series of economic crises commonly known as the Global Financial Crisis (2007-2008) and the Great Recession (2008-2009). The financial crisis was triggered by the collapse of the U.S. housing market, which caused panic on Wall Street, the center of global finance in New York. Due to the outsized nature of the U.S. economy compared to other countries and particularly the centrality of U.S. finance for the world economy, the crisis spread quickly to other countries, affecting most regions across the globe. By 2009, global GDP growth was in negative territory, with international credit markets frozen, international trade contracting, and tens of millions of workers being made unemployed.

Global similarities, global differences

Since the 1980s, the world economy had entered a period of integration and globalization. This process particularly accelerated after the collapse of the Soviet Union ended the Cold War (1947-1991). This was the period of the 'Washington Consensus', whereby the U.S. and international institutions such as the World Bank and IMF promoted policies of economic liberalization across the globe. This increasing interdependence and openness to the global economy meant that when the crisis hit in 2007, many countries experienced the same issues. This is particularly evident in the synchronization of the recessions in the most advanced economies of the G7. Nevertheless, the aggregate global GDP number masks the important regional differences which occurred during the recession. While the more advanced economies of North America, Western Europe, and Japan were all hit hard, along with countries who are reliant on them for trade or finance, large emerging economies such as India and China bucked this trend. In particular, China's huge fiscal stimulus in 2008-2009 likely did much to prevent the global economy from sliding further into a depression. In 2009, while the United States' GDP sank to -2.6 percent, China's GDP, as reported by national authorities, was almost 10 percent.

China’s export benefits from the significant fiscal stimulus in the United States. This paper analyzes the global spillover effect of the American economy on China’s macro-economy using the Markov Chain Monte Carlo (MCMC)-Gibbs sampling approach, with the goal of improving the ability of China’s financial system to protect against foreign threats. This paper examines the theories of the consequences of uncertainty on macroeconomics first. Then, using medium-sized economic and financial data, the uncertainty index of the American and Chinese economies is built. In order to complete the test and analysis of the dynamic relationship between American economic uncertainty and China’s macro-economy, a Time Varying Parameter-Stochastic Volatility-Vector Autoregression (TVP- VAR) model with random volatility is constructed. The model is estimated using the Gibbs sampling method based on MCMC. For the empirical analysis, samples of China’s and the United States’ economic data from January 2001 to January 2022 were taken from the WIND database and the FRED database, respectively. The data reveal that there are typically fewer than 5 erroneous components in the most estimated parameters of the MCMC model, which suggests that the model’s sampling results are good. China’s pricing level reacted to the consequences of the unpredictability of the American economy by steadily declining, reaching its lowest point during the financial crisis in 2009, and then gradually diminishing. After 2012, the greatest probability density range of 68% is extremely wide and contains 0, indicating that the impact of economic uncertainty in the United States on China’s pricing level is no longer significant. China should therefore focus on creating a community of destiny by working with nations that have economic cooperation to lower systemic financial risks and guarantee the stability of the capital market.

Non-Performing Loan Securitization Market Outlook

According to our latest research, the global Non-Performing Loan (NPL) Securitization market size reached USD 65.2 billion in 2024, reflecting a robust environment for structured finance solutions aimed at addressing distressed debt. The market is forecasted to expand at a CAGR of 8.7% from 2025 to 2033, reaching a projected value of USD 133.5 billion by 2033. This significant growth is driven by the increasing accumulation of non-performing assets across banking sectors worldwide, regulatory reforms encouraging off-balance-sheet management, and heightened investor appetite for higher-yielding structured products.

A key growth factor for the Non-Performing Loan Securitization market is the persistent rise in global NPL volumes, particularly in the aftermath of economic disruptions such as the COVID-19 pandemic and subsequent macroeconomic uncertainties. Financial institutions are actively seeking mechanisms to reduce their exposure to distressed assets, and securitization provides a viable pathway to transfer credit risk and improve balance sheet health. Additionally, regulatory bodies in both developed and emerging markets are increasingly mandating stricter capital adequacy norms, compelling banks to innovate in their asset management strategies. The structured nature of NPL securitization allows for better risk distribution, which is especially attractive to institutional investors seeking diversified fixed-income opportunities.

Technological advancements and digitalization within the financial services sector are further accelerating market growth. The deployment of advanced analytics, artificial intelligence, and blockchain technology is enhancing the transparency, efficiency, and traceability of NPL transactions. These innovations are not only reducing operational costs but also improving the accuracy of asset valuation and risk assessment. As a result, a broader range of investors—including hedge funds, private equity firms, and asset managers—are entering the NPL securitization market, attracted by the potential for higher returns and improved liquidity. The increasing sophistication of securitization structures, such as the use of tranching and credit enhancement, is also enabling the market to accommodate a wider array of asset types and risk profiles.

Another critical growth driver is the evolving regulatory landscape, particularly in Europe and Asia Pacific, where governments and central banks are implementing supportive frameworks for distressed asset resolution. Initiatives such as the European Union’s secondary markets for NPLs and the establishment of asset management companies in China and India are fostering a conducive environment for NPL securitization. These measures are not only aiding in the reduction of systemic risk within the banking sector but are also paving the way for increased cross-border investment flows. As regulatory clarity improves and market infrastructure matures, the NPL securitization market is expected to witness sustained expansion over the forecast period.

Regionally, Europe remains the largest market for NPL securitization, accounting for approximately 38% of global volumes in 2024, followed by Asia Pacific and North America. The European market’s dominance is underpinned by a legacy of high NPL ratios in Southern European countries and a well-developed secondary market ecosystem. Meanwhile, Asia Pacific is emerging as the fastest-growing region, driven by rising NPL levels in China, India, and Southeast Asia, coupled with regulatory reforms and growing investor participation. North America, while traditionally less reliant on NPL securitization due to a more robust corporate bankruptcy framework, is witnessing renewed interest as financial institutions seek to optimize capital allocation and manage credit risk in a volatile economic environment.

Asset Type Analysis

The Non-Performing Loan Securitization market is segmented by asset type into residential, commercial, corporate, consumer, and others. Residential NPLs, which primarily include defaulted mortgages and home equity loans, have historically represented a significant portion of securitized assets, especially in regions such as Europe and North America. The aftermath of the global financial crisis and subsequent housing market corrections led to a surge in residential NPLs, prompting banks to offload these assets through securit

Data and data sources.