Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

China wooing investors to Shanghai, with HSBC, Goldman answering

China wooing investors to Shanghai, with HSBC, Goldman answering

Central bank chief Yi Gang tells Bund Summit that the country’s focus on domestic economy does not mean it is shutting the door on the rest of the world.

Chinese financial officials have made fresh promises to open up the financial sector and attract international investors to the country’s main financial centre.

The pledges were made during the Shanghai Bund Summit, a two-day gathering of Chinese bankers and regulators, that offered the country’s leaders an opportunity to showcase their plans to the global financial community ahead of a key policy meeting in Beijing, where President Xi Jinping is expected to map out the country’s development blueprint for the next five years.

One key message China is trying to deliver is that it is committed to deepening its economic and financial ties with the rest of the world even though relations between Beijing and Washington have plunged to their lowest level in decades.

On Saturday, Vice-President Wang Qishan made a rare appearance at the summit and told delegates – who included former US treasury secretary Robert Rubin, hedge fund manager Ray Dalio and Bloomberg chairman Peter Grauer – that “win-win cooperation is the only right choice for the world”.

Yi Gang, the People’s Bank of China governor, told the event on Sunday that China’s “dual circulation” strategy, which will include an increasing emphasis on domestic consumption and innovation, is not intended to shut the door on the rest of the world but to make better use of “domestic and international markets”.

He said that, as the country that has contributed nearly a third of average global growth in average in the last two decades, China has to remain open to the world and financial opening will be a key piece in the puzzle.

“It should be noted that financial opening is mutually beneficial.” Yi told the forum. “Open competition helps the development and improvement of China’s financial industry, while international investors entering China can share the dividends of China’s growth and reform.”

China has accelerated its financial opening up since 2018, lifting longstanding restrictions on total foreign ownership of financial institutionsand making it easier for foreign investors to buy Chinese bonds.


Yi also said that China was working to make it easier for foreign investors to use the yuan. “The Chinese authorities will reduce restrictions on the cross-border use of yuan,” he told the summit, adding that China will enhance a “supporting system” to encourage its use.

Li Qiang, the Shanghai party secretary, told the event that Shanghai has made substantial progress in becoming an “international financial centre” and the city was trying to become the go-to place for foreign investors who want access to Chinese banking, securities and insurance.

“When President Xi Jinping visited Shanghai last year, he required us to enhance the role of Shanghai in global resource allocation. In particular, he specifically required that Shanghai’s financial market development must facilitate China’s national financial opening and yuan internationalisation.”

Fang Xinghai, a vice-chairman of the China Securities Regulatory Commission, said China was creating new channels for foreigners to invest in onshore stocks on top of existing channels such as the Qualified Foreign Institutional Investor scheme and the stock connect with Hong Kong.

The future of China’s capital market opening will be “comprehensive institutional opening”, an upgrade from the current “opening by providing channels”, Fang said.

While few international investors were able to attend the event in person – most foreign delegates took part via video-link – some participants welcomed the promises.

John Waldron, president and chief operating officer at Goldman Sachs, told the forum that the US bank was “encouraged by the enhanced access China providing foreign firms … which we believe will lead us to a stronger, more resilient Chinese financial sector.”

Waldron suggested that China should relax restrictions on outbound flows, allow foreigners to become market makers in the bond market, and align Chinese regulation with international norms to “bolster investors’ confidence in China’s capital markets, to pave the way for further inflows, and enable increased cooperation between the United States, the rest of the world, and China”.

Noel Quinn, chief executive of HSBC, said the bank’s commitment to mainland China “is unwavering even in today’s challenging time”.

HSBC has had a bumpy relationship with China after state media accused it of helping the US to “frame” the telecoms giant Huawei, whose chief financial officer Meng Wanzhou is currently fighting extradition from Canada on charges related to alleged breaches of sanctions on Iran.

The bank has also been excluded from an underwriting consortium for a sales of Chinese government bonds.

But Quinn said that HSBC, which was one of the event’s sponsors, “has been very pleased to be a proactive participant” in China’s financial opening up and the bank “looks forward to continuing to do so in the years to come”.

During a panel discussion Quinn also told Liao Min, the Chinese finance vice-minister, in a panel discussion that HSBC will submit a paper to the Chinese government offering suggestions on how to open up, including measures to encourage more overseas companies to issue shares in Shanghai.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Hungary Ranked Among the World’s Safest Travel Destinations for 2025
G7 Leaders Fail to Reach Consensus on Key Global Issues
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Shock Within Iran’s Leadership: Khamenei’s Failed Plan to Launch 1,000 Missiles Against Israel
Wreck of $17 Billion San José Galleon Identified Off Colombia After 300 Years
Man Convicted of Fraud After Booking Over 120 Free Flights Posing as Flight Attendant
Iran Launches Extensive Missile Attack on Israel Following Israeli Strikes on Nuclear Sites
Beata Thunberg Rebrands as Beata Ernman Amidst Sister's Activism Controversy
Hungarian Parliament Approves Citizenship Suspension Law
Prime Minister Orbán Criticizes EU's Ukraine Accession Plans
Hungarian Delicacies Introduced to Japanese Market
Hungary's Industrial Output Rises Amid Battery Sector Slump
President Sulyok Celebrates 15 Years of Hungarian Unity Efforts
Hungary's Szeleczki Shines at World Judo Championships
Visegrád Construction Trends Diverge as Hungary Lags
Hungary Hosts National Quantum Technology Workshop
Hungarian Animation Featured at Annecy Festival
Israel Issues Ultimatum to Iran Over Potential Retaliation and Nuclear Facilities
UK and EU Reach New Economic Agreement
Coinbase CEO Warns Bitcoin Could Supplant US Dollar Amid Mounting National Debt
Trump to Iran: Make a Deal — Sign or Die
Operation "Like a Lion": Israel Strikes Iran in Unprecedented Offensive
Israel Launches 'Operation Rising Lion' Targeting Iranian Nuclear and Military Sites
UK and EU Reach Agreement on Gibraltar's Schengen Integration
Israeli Finance Minister Imposes Banking Penalties on Palestinians
U.S. Inflation Rises to 2.4% in May Amid Trade Tensions
Trump's Policies Prompt Decline in Chinese Student Enrollment in U.S.
Global Oceans Near Record Temperatures as CO₂ Levels Climb
Trump Announces U.S.-China Trade Deal Covering Rare Earths
Smuggled U.S. Fuel Funds Mexican Cartels Amid Crackdown
Austrian School Shooting Leaves Nine Dead in Graz
Bezos's Lavish Venice Wedding Sparks Local Protests
Europe Prepares for Historic Lunar Rover Landing
Italian Parents Seek Therapy Amid Lengthy School Holidays
British Fishing Vessel Seized by France Fined €30,000
Dutch Government Collapses Amid Migration Policy Dispute
UK Commits to 3.5% GDP Defence Spending Under NATO Pressure
Germany Moves to Expedite Migrant Deportations
US Urges UK to Raise Defence Spending to 5% of GDP
Israeli Forces Intercept Gaza-Bound Aid Vessel Carrying Greta Thunberg
IMF Warns of Severe Global Trade War Impacts on Emerging Markets
Low Turnout Jeopardizes Italy's Citizenship Reform Referendum
Transatlantic Interest Rate Divergence Widens as Trump Pressures Powell
EU Lawmaker Calls for Broader Exemptions in Supply Chain Legislation
France's Defense Spending Plans Threatened by High National Debt
European Small-Cap Stocks Outperform U.S. Rivals Amid Growth Revival
Switzerland Proposes $26 Billion Capital Increase for UBS
×