Text: | Print|

Sunday opening for Shanghai’s free trade zone trial

2013-09-13 13:27 China Daily Web Editor: qindexing
1

Shanghai.s pilot free trade zone will officially open on Sunday, September 29 to allow financial product reforms involving free yuan convertibility under the capital account, liberal interest rates and foreign exchange, a city official said yesterday.

.The economic reforms propelled by the new central government will be first applied in the Shanghai FTZ trial, which is a national strategy,. said Wang Xinkui, director of Shanghai.s Counselor.s Office, and director of the city.s WTO Affairs Consultation Center.

Wang, who was involved in drawing up the draft plan for the trial, said reforms would be rolled out in a prudent way. .The details of the trial to be soon announced by the central government will not be the same as the market expected, that a fully open and free environment will be established due to the principal of prudent financial regulation..

He added: .Financial reforms will impose great risk to the existing system. The trial of reform in the FTZ will start with certain products involving capital account opening-up, and lifting restrictions on interest rates and foreign exchange quotas..

Wang believes the trial will benefit foreign banks that originate in free markets and are experienced in such products.

The model will be applicable across the Chinese mainland market if it is successful in Shanghai.

.The biggest strengths of the foreign lenders are risk-based pricing and risk management capabilities,. said Pan Yingli, professor at the Antai College of Economics and Management, Shanghai Jiao Tong University. .At this stage, they have more advantages than the Chinese lenders in an environment with liberal interest rates..

Singapore-based OCBC bank and Hong Kong-based Bank of East Asia followed Western global banks including Citi and HSBC yesterday in expressing their interest in taking part in the free trade zone trial.

Samuel Nag Tsien, chief executive officer of OCBC, said the opening of the free trade zone was exciting news for the bank as the trial would bring opportunities for financial companies. The bank will try to seize the opportunity for sustainable growth in China, he said.

BEA said that it had formed a special work team to identify potential opportunities in the free trade zone and may establish a presence in the area.

Comments (0)
Most popular in 24h
  Archived Content
Media partners:

Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.