Original title: 12 measures to support financial innovation in the Free Trade Area Focus on promoting RMB cross-border use
Beijing News (Reporter Gu Zhijuan) On November 23, the State Council issued the "Notification on Supporting Deployment and Reform Measures in the Pilot for Free Trade Area" (hereinafter referred to as the "Communication"), from the creation of an environment good investment and improving the level of trade facilitation. Promoting financial innovation to serve the real economy, advancing human resources and trying to improve the reform and innovation of the free trade pilot area.
The above announcements include 12 measures involving financial innovation, covering insurance, banking, securities, funds and other industries, in particular to promote trade facilitation and provide financial support for the reform of the FTA.
A series of measures to expand the scope of cross-border use of RMB in the free trade area
The announcement proposed a series of measures to support the development of RMB cross-border business in the free trade area, including allowing free financial institutions in the Free Zone Pilot to manage RMB derivatives for overseas institutions; supporting eligible banks to carry out RMB and foreign exchange. Or apply for cooperation with qualified banking financial institutions to conduct foreign exchange and on-site sales transactions; to support the Pilot Free Zone to conduct RMB cross-border business based on the appropriate account system for its own characteristics; Banking institutions issue RMB loans to overseas institutions and overseas projects based on real needs and prudential principles.
Wang Youxin, a researcher at China's International Finance Institute, told Beijing News that these measures are of great importance for promoting the cross-border use of renminbi. There are many bright spots. Allowing the bank with qualified methods to execute derivative transactions on the RMB and foreign currency markets directly expands market participants and does not provide the real demand principle in the document, which means that the forex trading area in the free trade area is fully covered. This includes both current and capital projects, as long as they are legally compliant and the risks are controllable.
Previously, domestic bank manipulation of RMB derivatives activity for overseas institutions was liberalized in the Shanghai Free Trade Area. In December 2015, the state government of the Shanghai Foreign Exchange Branch announced that it would allow banks in the Shanghai Free Trade Area to manage RMB and foreign exchange transaction transactions for overseas institutions. "Notification" is equivalent to expanding this activity to all 12 pilot pilot areas in free trade.
Free financial institutions have issued RMB loans to overseas countries In the past, only a few pilot areas have been able to do this business Wang Youxin said that the measures introduced by this date will make the two-way movement of RMB more perfect and will contribute to the promotion of the RMB in the "departure". Exit for use in large and offshore projects.
Support to the free trade pilot area for cross-border RMB business based on an accounting system appropriate to its own features means giving more freedom to each free trade area, allowing those trading areas to carry out cross-border RMB business depending on the real conditions, which leads to stimulate Innovation in Business by cultivating more market entities to use the renminbi.
In addition, the announcement also proposes to promote the use of RMB in bulk trade between countries exporting goods and Belt and Road countries and regions in petroleum products and guiding financial institutions according to "who imports and pays currency exchange ". The principle is to manage cross-border trade in petroleum products and to support the supply of taxable fuel in the Pilot Free Zone to be denominated and settled in RMB. This article is only for Zhejiang Free Trade Zone.
Wang Youxin has proposed that the purpose of this measure is to actively promote the function of establishing the RMB cargo power. On the one hand, the use of renminbi-denominated settlement in the bulk trade of commodities such as oil is to promote the renminbi power in the traditional field and, on the other hand, support to the free zone of liquid fuel supply in the renminbi is also expanding actively in emerging areas. RMB power pricing.
The central bank will actively expand the opening of the financial industry to the construction of the free trade area
Xu Zhong, director of the People's Bank Research Bureau, said at a state-of-the-state policy briefing on November 23 that since the establishment of the Free Trade Zone, cross-border RMB businesses have grown rapidly and investment and cross-border funding has continued to improve. The People's Bank of China played a full role in the "testing field" in reforming and innovating the FTA, promoting trade and investment facilitation as a starting point, respecting the principle of local currency priority and simplifying RMB's cross-border trading process under direct and direct investment . Businesses and people in the region use the local currency for cross-border transactions, which reduces exchange rates and reduces exchange rate risks.
In addition, the innovative financial services approach to the free trade area continues to improve the level of financial services. In addition to the Shanghai Free Trade Zone, other free trade pilot areas have also adapted to local conditions to achieve a variety of financial innovations. For example, the Guangdong Free Trade Area has launched an electronic banking license book to improve the convenience of registering and operating businesses in the region. Free Trade Zone Tianjin Pilot Supports Leadership Leadership to Solve External Debt Through Special Financial Support Policy for Leasing the Leasing Industry. The Fujian Fleet Free Trade Area provided innovative services in dealing with seafood trading and deposit financing financing and actively involved in the construction of the main road silk road.
As China announced the financial industry expansion roadmap in April this year, the financial industry's opening measures continued to decline, including the removal of foreign investment in Chinese financial institutions, the expansion of foreign financial institutions and the promotion of trade. and so on.
Xu Zhong said that the Chinese People's Bank has always adhered to three principles for opening domestic and foreign financial expansion: First, the national treatment and the principles of the negative list before admission, secondly, the opening of the financial industry will be coordinated with the mechanism exchange rate formation and the capital account convertibility process. Thirdly, while we open up, we must pay attention to the prevention of financial risks and we must coincide with the financial supervision capacities with the financial opening.
In the next stage, the Chinese People's Bank will actively expand the opening of the financial industry in building the free trade area, will encourage the free trade area to take the lead and to give priority to the financial industry's opening measures. The People's Bank of China will gradually reduce the negative list of the financial sector, relax the restrictions on the participation of foreign financial institutions in all areas involving financial licenses, expand substantially the field of activity of foreign financial institutions, and replace access restrictions and qualifications with prudential requirements to stimulate external financing. Institutions participate in the enthusiasm of China's financial market and promote a more free flow of funds.
Tianjin Free Trade Zone promotes open innovation in the financial sector.
Supporting people in the free trade area to invest in overseas securities, and the US stock market will facilitate
The announcement also proposed to support eligible Pilot Free Zone individuals to invest in foreign securities in accordance with the regulations.
According to the relevant announcement of China Securities Regulatory Commission, CSRC has not approved any domestic or foreign institutions to provide domestic investors with foreign securities transactions in addition to QDII, Shanghai -Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect mechanisms. Business Services. Domestic investors wishing to invest in overseas securities can invest in foreign stock markets by buying shares of QDII fund products and participating in Shanghai-Hong Kong Stock Connect transactions.
Previously, domestic investors generally opened accounts with foreign brokerage firms through their domestic Internet institutions, investing in US shares, etc., but this model was warned by the Securities and Futures Commission in 2016. Regulatory authorities consider that the website of the platform or the mobile phone of unapproved Internet companies Participation of the client in transactions on the overseas securities market does not have the appropriate security audits and legal safeguards and the investment accounts and the investment funds in securities are outside the territory of the country . The industry believes that with the implementation of the above announcement, domestic investors will be more convenient to invest in overseas capital markets, and at the same time, safer.
Beijing News reporter Gu Zhijuan Wang Quanhao Editor Zhao Ze Proof Wu Xingfa