Shanghai Free Trade Zone: Steadily Expanding Internal And External Stock Market Interconnection

The reporter learned from the seminar on China's financial new format held in Shanghai in 13th Five-Year. The deputy director of the central bank's Shanghai headquarters and Zhang Xin said that the Shanghai free trade zone has been ready to take the lead in fully realizing the technical preparations for RMB capital account convertibility.

In terms of risk prevention, Zhang said that the Shanghai free trade area has established a macro Prudential Management System for foreign debt scale, currency mismatch and short term capital flows, while in data collection, it can also conduct 24 hours monitoring of cross-border funds.

Yesterday, at the above seminar, Guo Qingping, vice president of the central bank, said that during the "13th Five-Year plan" period, China's economy entered a new normal. Structural pformation is the fundamental solution to deep-seated contradictions such as inappropriate allocation of resources and overcapacity.

Guo Qingping pointed out in particular that during the "13th Five-Year" period, China should complete the marketization reform of interest rates as soon as possible, and relax personal investment abroad, allowing RMB convertibility under capital account.

"Orderly increase cross border capital and financial pactions convertibility degree, encourage foreign capital to participate in mergers and acquisitions.

We should steadily expand the interconnection between domestic and foreign stock markets, actively and steadily expand the channels and application fields of cross border RMB, and strengthen the support for "one belt and one road".

As a pilot field for financial reform,

It is expected to continue to take the lead in Renminbi capital account convertibility.

In April of this year,

President Zhou Xiaochuan said at IMF annual meeting that China has made significant progress in capital account convertibility. According to IMF's classification of capital account pactions, 35 of the 40 items have been fully or partly convertibility, and only 5 items are completely non convertible.

Zhou Xiaochuan said that 6 specific reforms will be promoted in the future, including the pilot of qualified domestic QDII2, interconnection and cancellation of stock exchanges.

Prior approval matters, provide more convenience for overseas institutional investors to invest in China's capital market, further promote the international use of RMB, and take necessary measures to prevent and control risks in an emergency.

"After the 6 reforms came into full play, it means that our country has fully realized the convertibility of capital account."

Zhang Xin said that the focus of financial reform in Shanghai free trade area is to achieve a comprehensive breakthrough in the above 6 aspects, and promote Shanghai to take the lead in achieving capital account convertibility.

To this end, the Shanghai free trade zone has spent two years in technical preparation, and has completed the technical preparations for RMB capital account convertibility in 10 aspects.

For example, Shanghai has formed capital market convertibility mechanism and rational culture.

Data show that as of June 1st, through the free trade account, enterprises handled various cross-border funds settlement of 160 billion yuan, according to the new rules of cross-border financing, a total of about 70000000000 yuan.

Practice has proved that the Shanghai free trade zone has not become a hot money inflow and arbitrage pipeline.

There are two main reasons why Zhang Xin believes there are mainly reasons in the following aspects: first, the market has been highly open, and the two is that enterprises have been highly rational.

First of all, enterprises have been very rational. Under the new rules, enterprises' overseas financing is linked to the capital of enterprises. In such a state, enterprises are very rational in calculating the affordability of risk. Secondly, after so many years of financial reform, especially under the constant foreign exchange management, trade financing is also being liberalized. Enterprises have already had plenty of space under the sun. The impact of the new policy is not as great as expected.

Zhang Xin said.