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China continues to expand financial opening up

Date:2020-09-02  Hits:194
We will completely abolish the restrictions on the proportion of foreign shares in the fields of banking, securities, fund management, futures and life insurance; we will completely abolish the restrictions on the investment quota of qualified foreign institutional investors (QFII) and RMB qualified foreign institutional investors (rqfii); we will abolish the access restrictions in the fields of enterprise credit rating, credit rating, payment and liquidation, and give foreign investors national treatment



China has amidst the winds of change in turbulent international situation novel coronavirus pneumonia and the turmoil in the international financial market. China has continued to expand its financial opening and achieved remarkable results in a timely manner, with its commitment and effectiveness in keeping with the established rhythm.



We will continue to launch new policies with steady rhythm and solid steps



"In the process of establishing Nomura Oriental International, we have received the strong support of the Chinese government and relevant departments, and witnessed the determination of the whole country to promote opening up." "One of the reasons why we set up Nomura Orient International is that we feel the firm determination of the Chinese government to open up to the outside world," said Junkang Mishan, chairman of Nomura's China Committee



On April 28, 2018, China Securities Regulatory Commission (CSRC) announced the administrative measures for foreign invested securities companies, allowing foreign investors to hold up to 51%. Nomura Orient International Securities Co., Ltd. became one of the first two approved new foreign holding securities companies. On December 20, 2019, Nomura Orient International Securities Co., Ltd. was officially unveiled in Shanghai.



The opening up of financial industry is an important part of China's opening up pattern. China has always adhered to the principles of internationalization, marketization and legalization, and actively and orderly expanded the opening up of the financial industry at a high level.



The first foreign-owned securities company, the first wholly foreign-owned life insurance company, the first joint venture bank card clearing institution, the first wholly foreign-owned holding public fund In a short period of more than two years, many "first companies" have been added in the course of China's opening to the outside world, which also witnessed the growth of China's expansion of financial opening up.



Since April 2018, when China greatly relaxed its access to the financial market, under the overall coordination of the financial commission of the State Council, the people's Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission and the State Administration of foreign exchange have announced and promoted more than 50 specific opening measures. Even China's novel coronavirus pneumonia outbreak has not disrupted the pace of China's financial opening up, and the pace of opening up to the outside world has accelerated significantly.



In addition, local governments at all levels have actively launched new measures of financial opening up in light of their own development reality and economic characteristics. Beijing announced the action plan for implementing the new opening measures to promote the opening up and upgrading in the four fields of financial services and digital economy; Guangxi issued policies to speed up the construction of a financial opening portal for ASEAN; the Management Committee of the New Lingang District of Shanghai Free Trade Zone, together with the Shanghai headquarters of the people's Bank of China, issued the "comprehensively promoting the financial opening up of the new zone near Hong Kong in China (Shanghai) pilot free trade zone" And some measures for innovation and development



"Although great changes have taken place in the international environment, this will not change the general trend of our opening up. During the epidemic period, foreign financial institutions continued to settle in China, which is a good proof that China's financial industry has always been open to the outside world. " Guo Shuqing, Secretary of the Party committee of the people's Bank of China and chairman of the China Banking and Insurance Regulatory Commission, said.



Persisting in opening up, invigorating the confidence and charm of water extraction



We will completely abolish QFII and rqfii investment limits, relax restrictions on the proportion of domestic and foreign currency remitted by foreign institutional investors, and grant foreign institutions the qualification of A-type lead underwriter of non-financial debt financing instruments China's expansion of financial openness has attracted global investors to invest in China's financial market and jointly build and share the dividends brought about by China's economic development.



"China's financial opening-up measures have achieved good results. In terms of stock interconnection, our capital flow in and out is very convenient. We can make investment decisions clearly and conveniently based on our own evaluation of the market and the analysis of the investment value of listed companies." Zhu Chaoping, a global market strategist at Morgan asset management, said that foreign investors are generally optimistic about the certainty of China's economy, and the profits of related enterprises in the A-share market can be determined. Therefore, we can see that foreign capital in the A-share market is net inflow.



A shares are included in FTSE Russell and Mingsheng factors to 20%, and China's bonds are included in the global composite index of Bloomberg and the flagship index of JPMorgan Chase In recent years, China has expanded its financial openness and expanded access to global investors, which has also inspired the global market and attracted more incremental allocation funds to invest in the Chinese market.



According to the data of the State Administration of foreign exchange, as of the end of June, the balance of domestic bonds held by foreign investors was US $369.1 billion, and the balance of stocks held by domestic listed companies was US $368.4 billion, which was 13% and 16% higher than that at the end of 2019, respectively. The bond balance was three times that of the end of 2016, and the stock balance was 3.4 times that of the end of 2016. By the end of June 2020, nearly 900 overseas legal institutions have entered the inter-bank bond market, covering more than 60 countries and regions in the world. The scale of RMB bonds held is about 2.6 trillion yuan, which has increased by nearly 40% every year since 2017. At present, the scale of foreign institutions holding bonds accounts for 2.4% of China's total bonds, and the scale of holding treasury bonds accounts for 9%.



China has the world's second largest bond market and stock market, while the proportion of foreign capital holding is less than 4%. Judging from the development trend, there is still a better prospect and room for improvement.



"The pattern of increasing the holding of RMB assets by overseas funds in the medium and long term remains unchanged, because the positive effects of China's opening-up policy will continue to emerge, and the people's Republic of China's opening-up policy will continue to show
 
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