SHANGHAI (AFP) – China said yesterday it would further open its financial markets in the latest apparent attempt to cool economic tensions with the US, as IMF chief Christine Lagarde warned the world trade system was in danger of being “torn apart” by protectionism.
China’s securities regulator said foreign investors would be able to buy more Chinese stocks through existing programmes linking Hong Kong’s bourse with mainland exchanges, and that it will also “strive” to establish a similar link between Shanghai and London this year.
Central Bank Governor Yi Gang, speaking at the Boao Forum for Asia on the southern Chinese resort island of Hainan, also said Beijing would fast-track previously announced plans to remove limits on foreign shareholdings in Chinese financial institutions.
Foreign firms will be allowed to own as much as 51 percent of joint ventures in the securities, funds and futures industries, up from the current 49 percent.
All limits are to be removed in three years, the government had said previously.
Foreign ownership restrictions in Chinese banks and financial asset management firms will also be removed, it was announced at Boao.
The foreign-ownership reforms were first announced in November during a state visit by US President Donald Trump, but Wednesday’s announcements appeared to set a firmer timetable.
Mr Yi was quoted as saying implementation would commence “in the coming months”.
The latest promises came a day after President Xi Jinping pledged at the same forum to lower car tariffs and take other steps to open China’s economy “wider and wider”.
Mr Xi’s comments addressed major US complaints in their simmering trade row and triggered a rebound in world stock markets that had earlier quaked as the planet’s two largest economies traded threats of retaliatory import tariffs.
He doubled down yesterday, saying China would not swerve from reform and calling on trading partners “to board the express train of China’s economy”, according to the state-run Xinhua news agency.
Despite the positive signals, Ms Lagarde warned during a speech in Hong Kong yesterday that the world’s rules-based trade system was under threat from rising protectionist sentiment.
