CIFTIS financial thematic forums to showcase broad prospects of China's financial opening-up

Photo taken on Sept. 30, 2018 shows the Greenland Global Commodity Trading Hub in Shanghai, east China. As the financial center of China, Shanghai is a good example of the tremendous changes that have taken place in China since the reform and opening-up. (Xinhua/Fang Zhe)

The 2021 China International Fair for Trade in Services (CIFTIS) thematic forums on financial services, to be held during September 3-7 in Beijing, are set to showcase the broad prospects of China's financial opening-up. 

With theme of "Green Beijing, Open Finance", the thematic forums will invite government representatives and financial experts to share insights and views on the construction of national financial management center, financial opening-up and sustainable development, green finance and sustainable financial center construction, financial science and technology innovation and real economic development.

The thematic forums include  China International Fintech Forum, China Fintech Forum, China International Finance Annual Forum, Global PE Forum, China Credit Forum, China Capital Market Investment Summit, International Financial Innovation and Cooperation Forum and a high-end dialogue for Sino-foreign financial institutions, among other events. These forums and relateed events focus on opening-up of China's financial industry and aim to attract more global financial resources into the country. 

-- Financial participants will gather together to discuss financial opening-up

The financial service forums are coupled with a series of related events such as exhibitions, a digital finance carnival and signing ceremonies, which will be held in eight sections of exhibiting sites including headquarters finance, international finance, a Digital Finance Demonstration Zone, and financial services for science and technology financial innovation. 

A total of 143 international and domestic financial organizations, financial institutions and enterprises, including 29 renowned enterprises among Fortune Global 500, will participate in the financial services thematic exhibition at CIFTIS this year.

The 2021 CIFTIS has attracted 59 foreign institutions from 18 countries and regions such as Morgan Stanley, Mastercard, the Society for Worldwide Interbank Financial Telecommunications (SWIFT), and DBS Bank.

At the 2020 CIFTIS, Morgan Stanley showcased its development achievements in China at the core financial exhibition zone. "Our achievements are closely related to China's ongoing financial opening-up," said Dong Gang, Chairman of Morgan Stanley Bank International (China) Limited. He added that Morgan Stanley will support the 2021 CIFTIS.

The digital finance carnival also will mark a highlight of this year's CIFTIS. According to Wang Ying, Deputy Director General of Beijing Local Financial Supervision and Administration, the Carnival, will consist of the Digital Finance Demonstration Zone, the financial technology competition, and robo-advisor experience, among others. These aim to make the exhibition more interesting, interactive and experience-oriented for visitors.

In addition to exhibitions, panelists from around the world have been invited to hold dialogues on the frontiers of financial services at several much-anticipated forums and summits, such as the 2021 China International Finance Annual Forum, China International Fintech Forum, China Credit Forum, and China Capital Market Investment Forum.

Major financial cooperation projects will be signed and financial achievements to be released in the event, in an attempt to facilitate the application of financial achievements through targeted match-making efforts.

-- Faster pace of China's financial opening-up

The financial services thematic exhibition, along with the financial forums, will signal the further opening-up of the financial industry so as to attract more global financial resources.

Experts hold that China is accelerating the two-way opening-up of its financial market, and has issued a series of important policies in this regard. In the next phase, China will continue to broaden opening-up on its financial industry underpinned by overall reform planning, development, and risk prevention.

China has made good progress in opening-up its financial sector in recent years. According to data from China Banking and Insurance Regulatory Commission (CBIRC), by the end of 2020, foreign banks set up 41 foreign banks with legal person status, 116 foreign bank branches, and 144 representative offices in China, with a total of 946 business entities; total assets of foreign banks stood at 3.78 trillion yuan. Foreign insurers had established 66 insurance institutions, 117 representative offices, and 17 insurance intermediaries, with total assets amounting to 1.71 trillion yuan.

According to the report on RMB internationalization 2020 published by the China Banking Association, cross-border payments denominated in RMB hit a record high in 2020 and continued to gain momentum. China's cross-border use of the RMB surged 44.3 percent year on year to 28.38 trillion yuan in 2020.

As China's two-way opening-up of its financial market continued to gather pace, the China interbank bond market (CIBM), RMB Qualified Foreign Institutional Investors (RQFII), RMB Qualified Domestic Institutional Investors (RQDII), Shanghai and Shenzhen Stock Connect, mutual recognition of funds, Bond Connect, and other RMB investment channels were established. The world's three major bond indices including Bloomberg, J.P. Morgan, and FTSE Russell have announced that they would include or have already included RMB bonds in their respective indices.

It is noted that China has adopted a series of major policies this year for a higher level of financial opening-up and innovation. China's central government recently has released a guideline to support the high-level reform and opening-up for the Pudong New Area in Shanghai and to build Pudong into a pioneer area for socialist modernization. The move implies that Pudong will play an important role in pooling global financial resources. Industry insiders said that the CIFTIS will continue to send out a strong signal for China's further financial opening-up.

-- Financial opening-up and security

Experts reveal that China will further broaden financial opening-up in the future underpinned by overall reform planning, development, and financial risk prevention.

China's central bank noted that the financial opening-up will continue to progress in an orderly manner, and China is committed to take the initiative to align the financial sector with high international standards, and also promote a higher level of financial opening-up based on a negative list.

"China's financial market and financial regulatory system are still work-in-progress. If our financial market, and the capital account in particular, open up too quickly, domestic financial stability could face significant challenges," said Xu Qiyuan, Director of the Economic Development Division of the Institute of World Economics and Politics at Chinese Academy of Social Sciences, adding that the prerequisites for stable and long-term financial opening-up are to promote domestic financial reform, and improve the domestic financial market and regulatory system in China.

According to Guan Tao, chief global economist of BOC International (China) Co., Ltd., high-level financial opening-up should be an institutional opening-up during which China's financial sector should align with international economic and trade rules. This, however, does not mean that institutional opening-up can be achieved instantly.

Guan added that China's financial opening-up should be done step by step with overall security ensured. Subject to prudential principles, further financial opening-up should be a process of "inclusion" rather than "exclusion". China should also continue to bolster the world's confidence in its opening-up policies, thus attracting more long-term investments.