China should trim state shareholdings: central bank adviser

BEIJING (Reuters) - China should sell off some of its shareholdings in public companies, a senior government adviser wrote in an opinion piece in the China Daily newspaper on Monday.

Xia Bin, an academic adviser to the central bank, suggested the move as one of three policies that could help China boost its economy and optimize its structure.

"By selling a part of its shares even while preserving control over the economy, the state can raise funds to stimulate consumption and provide relief to those in need," he wrote. "It can also help to form a virtuous circle of the economy."

China's government presides over a huge portfolio of majority stakes in a wide range of companies, ensuring that it retains overall control of corporate strategies in areas from airlines and mobile phones to banking, insurance, oil and minerals.

He also reiterated his proposal that China should consider floating deposit rates.

"The rising consumer price index means there is a perfect opportunity to introduce floating deposit rates that would help in garnering more funds."

His other proposal was to focus more on the "hukou" system of residential registration rather than building more homes, to help migrant farmers take advantage of opportunities and amenities in the cities.

(Reporting by Tom Miles; Editing by Jacqueline Wong)