China’s central bank, foreign exchange regulator vow further financial opening-up

Lujiazui area in Shanghai Photo:Xinhua

Lujiazui area in Shanghai Photo:Xinhua

China’s central bank and top foreign exchange regulator held a meeting on Monday with representatives of multinational financial institutions, vowing to further improve the business environment, in an effort to reassure businesses amid a smear campaign launched by Western officials and media outlets against the Chinese economy. 

The meeting, chaired by Pan Gongsheng, governor of the People’s Bank of China (PBC) and head of the State Administration of Foreign Exchange (SAFE), offered much-needed encouragement for foreign businesses and sent an unmistakable signal that China will continue to open up its market for businesses from around the world, in contrast to attempts by the US and its allies to restrict normal investment activities, Chinese experts said. 

The meeting was attended by some global businesses, including JPMorgan Chase, HSBC, Deutsche Bank, BNP Paribas, UBS Securities, MUFG Bank, Tesla, BASF, Trafigura and Schneider, and it aimed to hear relevant opinions and suggestions from foreign businesses, and study increased financial support to stabilize foreign trade and investment and optimize the environment for foreign investment, according to a statement from the PBC. 

Pan said that actively attracting and utilizing foreign investment is an important part of promoting high-level opening-up and building a new open economic system, vowing that China will continue to open up its market for global businesses. 

The PBC and the SAFE will effectively carry out existing policy measures to stabilize foreign trade and investment to continuously optimize policy arrangement and improve the business environment, Pan said. 

Representatives of foreign financial institutions noted China’s steady financial opening-up in recent years, and expressed hopes that further efforts will be made to continuously improve the business environment, according to the PBC statement. 

The meeting has invited key global financial institutions, including those from the US, which is “a huge encouragement” for the businesses and “an unmistakable signal” for the world that companies from anywhere, including Europe and the US, are welcome to invest in China, Cao Heping, an economist at Peking University, told the Global Times on Monday. 

Cao said that China’s proactive, welcoming attitude stands in stark contrast to restrictive measures imposed by the US and Europe on normal investment activities, and will greatly help attract foreign investment. If they continue to impose restrictions, investors will “vote with their feet and will come and invest, despite the restrictions,” Cao said. 

Amid rising downward pressure, China has made stabilizing foreign investment a top priority and issued measures to boost foreign investment. In August, the State Council, the cabinet, issued a 24-point guideline to improve the climate for foreign investment and attract more funds. 

Specifically, the guideline vowed to strengthen the foreign investment climate in six key ways: improving the quality of utilizing foreign investment, ensuring national treatment for foreign-backed enterprises, strengthening the protection of foreign investment, improving investment and business facilitation, increasing fiscal and tax support and upgrading the facilitating mechanism for foreign investment.

The Monday meeting was a crucial step in learning about suggestions from industry leaders and attracting foreign investment, Tian Yun, a Beijing-based economic analyst, told the Global Times on Monday. 

“There has been much noise overseas about shorting China, and the meeting probably covered the medium- and long-term development of the Chinese economy and the objective view of and confidence in China’s long-term development,” Tian said. 

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