The China (Hainan) Pilot Free Trade Zone (FTZ) will take more steps to expand the opening-up of its financial sector, helping promote the country's development amid global protectionism and downward pressure on the world economy.
Thirty measures are set to be applied to the pilot FTZ located in South China's Hainan Province, read a statement released by China's Ministry of Commerce (MOFCOM) on Tuesday.
Among the measures, there are seven steps focusing on financial markets, such as supporting private capital to enter the financial sector and strengthening cooperation with the offshore yuan market, said the statement.
"The latest measures with regard to the Hainan Pilot FTZ include efforts to open market to both domestic and foreign capital," Gao Lingyun, an expert at the Chinese Academy of Social Sciences, a think tank, told the Global Times on Tuesday.
According to a statement released by the pilot FTZ, private capital is encouraged to enter the financial sector, such as supporting qualified private capital to establish private banks, financial leasing companies, financial companies and others.
"The step is also in line with the opening-up of China's services sector," Gao said.
There are also plans to strengthen cooperation with the offshore yuan market, as well as steps to explore mechanisms to connect capital and financial markets with those in Hong Kong and Macao.
It is reasonable to diversify China's channels to connect with global financial markets during the process of its opening-up, instead of excessively relying on the Hong Kong Special Administrative Region, which is also a message to Hong Kong to some extent, Gao said.
Gao noted that it is risky for China's economic growth if there is only one major financial connection with the world through Hong Kong, which has been damaged by recent unrest.
Hainan Island maintains unique advantages in cultivating an offshore financial center, which makes it an ideal choice for the province's industrial development, an industry expert surnamed Dong told the Global Times.
Other steps to expand financial opening-up include promoting the use of the yuan in the pricing and settlement of commodity trade, and encouraging domestic capital and overseas institutions to establish joint venture investment funds in the FTZ.
To implement experienced measures in the Hainan FTZ shows China's solid and cautious steps to promote its opening-up. Speaking of the pace of opening-up, Gao said it is a responsible way for both China and the world to promote the plan with risky elements under control, instead of opening up its market in one step."