Finance ministry encourages Shenzhen to take the lead in tax reform
China’s fiscal and taxation systems are in dire need of an overhaul and the top leadership knows it, although it’s been reluctant to tackle the problems in a serious way. The shortcomings of the current fiscal system, which emerged after the reforms of 1994, have left local authorities shouldering most of the fiscal burden without the necessary fiscal income.
CBIRC implements new business classification rules for trust companies
The updated trust business classification system is part of a broader government strategy to de-risk the financial sector. Since a wave of high-profile scandals involving…
PBoC Governor Yi Gang sets out long financial “to-do” list
There are no big surprises here. The PBoC’s message is that, during Xi’s third term, we can expect much more of the same.
October foreign financial institution approvals and specific financial opening developments
Sun Life/Manulife; BlackRock; Prudential Financial; BNP Paribas; Goldman Sachs
Shanghai Stock Exchange launches 13 indices to encourage funding for tech development
Beijing sees tech innovation as an engine of growth as policymakers increasingly focus on the quality of economic growth rather than quantity. Developing the domestic capital markets will be key to…
Shenzhen Stock Exchange allows companies with Hong Kong primary listing to join Stock Connect
These changes will make converting primary listings to Hong Kong more attractive as inclusion into the Stock Connect offers access to mainland investors, especially…
Hong Kong Chief Executive highlights importance of Hong Kong-mainland integration
Lee’s speech highlights a reality that has become increasingly clear in recent months, namely, that Hong Kong policymakers increasingly see integration with mainland policy goals as…
PBoC, SAFE increase macroprudential adjustment parameter in attempt to slow RMB depreciation
With the RMB trading against the dollar at levels last seen in 2008, it seems clear that this move is about slowing the yuan’s decline – though it’s not clear whether raising the MAP will have the desired effect. With US rates so high, China’s banks may be reluctant to borrow dollars.
PBoC, SAFE share their takeaways from Party Congress
While that last point is incredibly vague, it hints that the regulators are likely considering new measures to bolster developers through the stock and bond markets. We also suspect the authorities will look to further streamline and consolidate China’s byzantine bond market.
CSRC stresses importance of developing capital markets in Party Congress reflections
The CSRC is going to be very busy during Xi’s third term. Beijing has major plans to steer more of the country’s savings into domestic capital markets, and, in doing this, to fund the policy-priority sectors that will help drive the next phase of China’s growth – areas such as green energy and advanced manufacturing.
Shenzhen issues the most detailed environmental information disclosure requirements for financial institutions yet
Shenzhen’s guidelines provide an unprecedented degree of specificity that builds on the Guidelines for Financial Institutions’ Environmental Information Disclosure, signaling the implementation of China’s environmental and green finance information disclosure system after putting in place uniform standards across the financial sector last year.
CBIRC measures to streamline administrative approvals for domestic lenders go into effect
These changes are part of the broader fangguanfu campaign – spearheaded by Premier Li Keqiang – that roughly translates to…
Major banks and insurers release statements in support of Beijing’s policies
The financial sector is falling over itself to support government policies, particularly in light of the Party Congress. That push, plus the…
UBS becomes first foreign firm to trade Chinese commodity futures under QFII scheme
China has the world’s biggest commodities futures markets, but their insularity means they only have limited relevance to global commodities pricing. Increasing the relevance of Chinese commodity markets is…
Shanghai Stock Exchange names new Party secretary
Qiu’s views on financial markets appear to align closely with Beijing’s broader ambitions – including the many initiatives currently underway. Both increased regulatory supervision and…
PBoC releases exchange rate management report
Beijing is confident in its exchange rate policy. This report signals that the tried-and-true mix of light-touch intervention and “reasonable” market fluctuations is here to stay.
PBoC releases RMB internationalization report
Over the last couple of years, Beijing has elevated RMB internationalization as a policy goal. It’s slow going, but a regular flow of supportive reforms – as well as growing international RMB use fueled by Western sanctions on Russia over its invasion of Ukraine – will ensure further progress.
PBoC releases derisking report
Much of the corruption, opacity, and shoddy credit evaluation that has plagued China’s financial industry for decades has indeed been substantially ameliorated in recent years. And it’s high time. As growth slows, it’ll become harder to hide financial risks.
PBoC outlines key priorities for developing onshore bond market
Improving the bond – and equity – market’s ability to channel funding to cash-starved, innovative private firms is key to Beijing’s tech development plans. To date, there’s little progress to speak of despite the PBoC’s insistence.
September foreign financial institution approvals and specific financial opening developments
Allianz discussing onshore expansion; Goldman Sachs reduces China workforce; Bank CEOs testify before US Congress…