Giving its huge reserves and assets a bigger role in developing the real economy is a pressing and crucial task for the country

China has achieved remarkable progresses in the financial realm since reform and opening-up was initiated in 1978, and its foreign reserves, central bank assets and domestic savings all rank first in the world.

However, how to cultivate a self-growing financial vitality, develop itself from an economic power to a financial power and give its huge financial assets a bigger role in the development of the real economy are pressing and demanding tasks for the country's decisions-makers.

In the context of the country's huge financial achievements, domestic financial institutions have made substantial improvements in terms of their capital adequacy ratio, governance capabilities and the level of earnings. The country's central bank assets were 28.6 trillion yuan ($4.73 trillion) by the end of October, much higher than the $2.85 trillion held by the US Federal Reserve, $2.73 trillion by the European Central Bank and $1.8 trillion by the Bank of Japan. China is also among the countries with the highest deposit ratio, with the total value of its various forms of deposits exceeding 80 trillion yuan.

Nevertheless, such outstanding performances do not alter the fact that China still has a long way to go before it develops into a financial power. So a comprehensive financial strategy should be laid out to optimize the country's established financial system and promote its financial transformation so that it is commensurate with its ongoing economic transformation.

Despite its huge financial and capital fluidity, a large number of China's small and medium-sized enterprises have been struggling to survive a funding insufficiency. This has been largely caused by the unreasonable distribution of resources as the result of the country's extensive economic development model and its dysfunctional interest rate facilities.