Separate finance negative list set to boost openness
The China (Shanghai) Pilot Free Trade Zone (FTZ) is likely to adopt a separate negative list for the financial sector in addition to the negative list it already has for overseas businesses, Tu Guangshao, deputy mayor of Shanghai, said in a press conference held on Tuesday.
He also disclosed that Shanghai is working with the National Securities Regulatory Commission (CSRC) on the possible launch of a stock connect project between Shanghai and London.
The press conference, held by the Information Office of Shanghai Municipality on Tuesday, revealed the progress that has been made in the Shanghai FTZ's financial work in terms of innovation and openness in 2015, as well as the future plans for the zone.
Tu said that in 2015 the Shanghai FTZ had launched a series of innovative measures, such as promoting cross-border use of the yuan and launching the first phase of the cross-border payment system in October, as well as establishing an international energy exchange center.
Tu also said that the Shanghai FTZ would actively implement the 40 reform measures that were the key aspects of guidelines released in October 2015 for pushing financial openness and innovation in the zone.
The Shanghai municipal government will respond actively to the central government's call for financial openness and innovation by pushing forward the construction of a more open financial market, Tu noted, adding that compiling a separate negative list specially for the financial sector would be part of this effort.
A negative list identifies those sectors and businesses that are off-limits for investment, with all other areas being freely accessible. The Shanghai FTZ has adopted the negative list approach since its launch in 2013.
Ni Shoubin, a professor with the Shanghai University of International Business and Economics, told the Global Times on Tuesday that the negative list for the financial sector should be clearer, and allow easier market access for financial companies compared with the existing general negative list for the Shanghai FTZ.
Tu also noted that the Shanghai municipal government is working with the CSRC on the launch of a Shanghai-London stock connect, a program that would establish mutual stock market access between the Chinese mainland and the UK.
The process of setting up the new stock connect program will draw on experience from the Shanghai-Hong Kong Stock Connect program, which was launched in November 2014, Tu said.
Ni said that this program would facilitate Chinese investors' efforts to use their financial assets in a more global context.
Lu Qianjin, a professor of international finance at Fudan University, told the Global Times on Tuesday that the launch of the Shanghai-London stock connect program would also promote internationalization of the yuan, as it would increase the capital flows between China and overseas markets.