Shanghai Free Trade Zone: Capital In And Out Implementation Of "Hidden" Total Control

The reporter noted that Zhou Xiaochuan said at the annual meeting of IMF that China will adopt a managable and freely convertible and managed content, including monitoring and analysis of cross border pactions involving money laundering, terrorist financing and over use of tax havens; macro Prudential Management of foreign debt scale and currency mismatch; implementation of short-term capital flows when necessary; and strengthening of international balance of payments detection and analysis.

Zhang Xin also said that the Shanghai free trade area has established a management convertibility institutional arrangement, which is the main content of Shanghai free trade area related system arrangement and technical preparation.

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.

This is reflected in the implementation details of the macro Prudential Management of free trade account overseas financing and cross-border capital flows issued in February this year.

At the same time, we have established a policy reserve for gross regulation and emergency management with large capital and large output, and established a total gate control mechanism.

When the total amount of capital moves to the gate, the emergency plan will be activated to adjust the macro Prudential parameters.

Zhang Xin explained in detail that

The characteristic is stealth, enterprise and

In accordance with the rules of the market to do business normally, not subject to total control interference, only to a certain amount of time to communicate and adjust.

Another important technology preparation is the detection of anti money laundering, anti terrorist financing and anti tax evasion, which will become the main battleground of risk prevention in Shanghai free trade area.

Zhang Xin said that the Central Bank of Shanghai headquarters has set up a special monitoring room, 24 hours of monitoring, make full use of big data information.

In data collection, a powerful, multi angle, risk tracking account management system has been set up. It can carry out 24 hours monitoring of cross-border funds and monitor the origin and purpose of funds.

Besides,

It has also established a system of statistics and monitoring of the balance of payments which can be adapted to convertibility, set up an integrated management framework for foreign currency, and track services after the outflow of funds. A cross sector monitoring and analysis and emergency coordination mechanism for cross border funds in Shanghai has been established.

Zhang said that all the above technical preparations will be the overall framework of the Shanghai free trade area after the capital account convertibility.