China’s central bank has set measures to open up its country’s financial sector to foreign investment as Beijing aims to back free trade and globalisation amongst American trade war, international law firm Pinsent Masons has noted.
Yi Gang, the governor of the People's Bank of China (PBC), told the 17th annual Boao Forum for Asia conference that China will allow foreign firms to compete equally with domestic companies and that the cap on foreign ownership in brokerage firms, futures companies and fund management firms will be lifted from 49 percent to 51 percent within the next three years.
The PBC has also confirmed its aims to launch the London-Shanghai Stock Connect initiative by the end of the year, a planned trading link allowing Chinese investors to access shares listed in London.
China also intends to encourage foreign ownership in trust companies, financial leasing and motor finance, currency brokerage and consumer finance within the year, Mr Gang said.
Other measures outlined include the removal of foreign equity stake restrictions on newly created financial investment firms and wealth management companies, which would expand business operations of foreign banks in China
The governor's announcements come amid accusations made by US president Donald Trump that China is limiting foreign firms’ access to its markets, to which Chinese president Xi Jinping responded by saying he wants to open up a new phase of the Chinese economy to foreign investment and promote import growth.
Mr Jinping added that China also intends to "significantly lower" import tariffs on motor vehicles, and will seek faster progress towards joining the World Trade Organisation (WTO) Government Procurement Agreement.
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