It is related to the opening up of the financial industry to the outside world, boosting investor confidence, and weighing heavily on the weekend! The People's Bank of China, China Securities Regulatory Commission, and others speak out
On September 3rd, Zhou Liang, Deputy Director of the State Administration for Financial Regulation, Jiao Jinhong, Chief Lawyer of the China Securities Regulatory Commission, Jin Zhongxia, Director of the International Department of the People's Bank of China, and Zheng Wei, Deputy Director of the State Administration of Foreign Exchange, attended and delivered speeches at the 2023 China International Finance Annual Forum. In their speeches, the main leaders of these financial management departments revealed the latest deployment arrangements for the financial industry's next steps of opening up to the outside world, and also responded to hot issues such as how to boost investor confidence and how to provide high-quality services for green and low-carbon transformation in finance.
Zhou Liang from the State Administration of Financial Regulation: Accelerating the Development of Green Finance and Dealing with Three Pairs of Relationships Well
Zhou Liang pointed out that currently, China's economic and social development has entered a high-quality stage of accelerating green and low-carbon development. The banking and insurance industry must firmly implement the new development concept, accelerate the development of green finance, and handle the relationship between development and emission reduction, overall and local, current and long-term.
To accelerate the development of green and low-carbon transformation and provide high-quality financial services, Zhou Liang pointed out that the State Administration of Financial Regulation will focus on preparing four aspects of work:
One is to establish sound rules and standards. Gradually improve the framework of green and low-carbon development and green finance system, and form financial policy arrangements that match the dual control of carbon emission intensity and total amount. Further improve the statistical monitoring and assessment system for green finance, research and develop green finance information disclosure standards, and provide guidance for financial institutions to comprehensively measure carbon footprint and strengthen the management of climate and environmental risks.
The second is innovative product services. Increase financial support for renewable energy, green manufacturing, green buildings, green transportation and other fields, promote the research and application of green and low-carbon technologies, explore innovative products such as merger and acquisition financing, climate bonds, and green credit asset securitization. Further develop the financing business of pollution discharge rights and carbon emission rights collateral, prudently carry out carbon finance business, improve the effectiveness and market liquidity of carbon pricing, enrich green insurance products, explore differentiated insurance rate mechanisms, and enhance the risk protection ability for green economic activities.
The third is to strengthen risk management. Strictly control project financing carbon emissions, improve customer credit management, incorporate carbon performance and pricing into the credit management process, and collaborate to promote green and digital transformation. Utilize financial technology to enhance the management ability of climate and environmental risks, explore scenario analysis and stress testing, evaluate the risk exposure of assets in high carbon industries, and prepare targeted response plans.
The fourth is to improve daily supervision. Implement green finance regulatory policies, optimize business processes, improve the green finance regulatory indicator system, incorporate the progress of green transformation into daily regulatory evaluations, strengthen monitoring and analysis of implementation and related risks, and ensure the safe and stable operation of banking and insurance institutions.
The fifth is to promote international cooperation. Under the framework of the United Nations Climate Change Convention and the Paris Agreement, we will strengthen international exchanges and cooperation in green finance, play an active role in the formulation of international rules, tell a good story about China, take the "the Belt and Road" as an important platform for international cooperation in green development, and actively explore new models, new paths, and new mechanisms for financial support of carbon peaking and carbon neutrality.
Jiao Jinhong from the China Securities Regulatory Commission: Boosting investor confidence with sound rule of law and strong regulatory enforcement
Jiao Jinhong pointed out that boosting investor confidence relies on a sound rule of law, strict regulatory enforcement, and sound investor protection. A scientifically complete legal system is necessary to ensure that all parties in the market have full trust in the rules and order of the market, have stable expectations for market development, and can invest with confidence; By strengthening supervision and law enforcement, promoting listed companies to improve corporate governance, enhancing the quality of financial information disclosure, timely eliminating bad eggs and bad apples in the market, maintaining market order, and allowing all parties in the market to clearly see the investment value of listed companies, the vitality of the market can be significantly enhanced; A sound investor protection system is an important guarantee for boosting investor confidence, maximizing the prevention of infringement on the legitimate rights and interests of investors. Even if investors are infringed upon, illegal and irregular behaviors can be promptly investigated and punished, and investors can receive timely compensation for their losses, so that investors can have confidence.
Jiao Jinhong stated that in recent years, the China Securities Regulatory Commission has actively promoted the legal construction of the capital market, strengthened regulatory enforcement, and focused on improving the protection of investors, achieving significant results. Including vigorously promoting the construction of the rule of law, a series of basic systems for long-term and fundamental management have been successively implemented, and the legal system of the capital market is becoming increasingly perfect. Strengthen capital market supervision, regulation and law enforcement, and crack down on illegal and irregular behaviors with zero tolerance. Efforts will be made to strengthen investor protection, and a securities civil compensation system with Chinese characteristics will be basically formed.
"Strengthening the construction of the rule of law in the capital market and strict supervision and law enforcement are important aspects of building a modern capital market with Chinese characteristics." Jiao Jinhong said that the China Securities Regulatory Commission will strive to boost investor confidence with sound rule of law and strong regulatory law enforcement in the next step.
One is to continuously improve the legal system of the capital market. Promote the revision of the Company Law, formulate regulations for the supervision of listed companies, accelerate the promotion of institutional rules in various aspects of the capital market, establish reforms, abolish interpretations, and make the legal system of the capital market more scientific and complete, providing stronger legal protection for regulatory enforcement.
The second is to improve the regulatory and law enforcement system and mechanism of the capital market. Comprehensively promote regulatory transformation, strengthen regulatory coordination among various lines, build an efficient and collaborative regulatory framework, improve the Chinese characteristic securities law enforcement system and mechanism that meets the needs of capital market development, strengthen the deterrence of zero tolerance law enforcement, deepen cooperation and cooperation with public security and judicial organs, and enhance the joint force of regulatory law enforcement.
The third is to innovate regulatory methods and continuously improve the toolbox of regulation. Adhere to scientific supervision, classified supervision, professional supervision, and continuous supervision, continuously improve the efficiency of supervision, promote transparent supervision, strive to eliminate "pocket policies", strictly regulate discretionary power, and strive to improve the transparency and consistency of supervision.
The fourth is to enhance the level of regulatory technology and accelerate the construction of regulatory technology platforms. Further improve the integration of regulatory information, develop and promote practical analysis tools, promote deep integration of business and technology, and enhance the intelligence level of regulation.
The fifth is to continuously strengthen investor protection efforts and adhere to integrating investor protection concepts into all aspects of the capital market supervision chain. Promote the normalization of collective litigation with Chinese characteristics, coordinate the use of administrative settlement, advance compensation, order repurchase, and other institutional measures, enrich the practice of supporting litigation demonstration judgments through shareholding exercise, and effectively protect the legitimate rights and interests of investors.
Jiao Jinhong emphasized that confidence is more important than gold, and China's economy has significant development resilience and potential. New industries and enterprises with international competitive advantages continue to emerge, and the long-term fundamentals of the economy have not changed. Although the capital market is facing challenges, there are more opportunities. "We believe that under the strong leadership of the Party Central Committee and the State Council, and with the strong support of various departments and relevant parties, investors' confidence will definitely accelerate, and China's stock market will have a healthier tomorrow."
People's Bank of China Jinzhongxia: Balancing openness and stability is the key to the stable development of the financial industry
Jin Zhongxia pointed out that in recent years, the People's Bank of China, together with relevant financial management departments, has actively and orderly promoted the opening up of the financial industry, significantly relaxed market access for the financial services industry, deepened the opening up of the financial market, and made steady progress in the internationalization of the RMB.
According to the Financial Industry Foreign Direct Investment Restriction Index compiled by the Organization for Economic Cooperation and Development (OECD), China has seen the fastest and greatest improvement in the ranking of financial industry openness in recent years. Meanwhile, the renminbi has become the world's fifth largest reserve currency, fifth largest payment currency, fifth largest trading currency, and third largest trade financing currency. In July of this year, the proportion of RMB in global payments exceeded 3% for the first time. From a trade perspective, from January to July, the proportion of RMB settlement in goods trade reached 24%, the highest level in recent years. From an investment perspective, by the end of June, the balance of RMB assets allocated by overseas entities had reached 9.8 trillion yuan.
Jin Zhongxia stated that in the next step, in promoting a higher level of opening up of the financial industry to the outside world, the People's Bank of China will focus on the following work:
One is to improve the management model of pre admission national treatment+negative list, forming a systematic and institutionalized open situation.
The second is to optimize the business environment. On August 7th this year, the State Council issued the "Opinions on Further Optimizing the Foreign Investment Environment and Increasing the Attraction of Foreign Investment". Jin Zhongxia pointed out that the People's Bank of China should not only expand market access, but also optimize policy arrangements after access.
The third is to ensure that financial management capabilities match the level of openness. For a period of time, there have been new changes in the global economic and financial situation, with global liquidity tightening, intensified financial market volatility, and exposure of financial risks. Some financial institutions in developed countries have experienced runs, and some developing countries are also facing the spillover effects of interest rate hikes by developed economies.
"These all remind us once again that while expanding the opening up of the financial industry, we must also maintain financial security and stability. Only by striking a balance between openness and stability can we achieve stability and progress," said Jin Zhongxia.
Zheng Wei, Deputy Director of the State Administration of Foreign Exchange: Adhere to Deepening Reform and Assist in High Level Opening up of Cross border Investment and Financing
Zheng Wei pointed out that the stability and resilience of China's foreign exchange market continued to increase in the first half of the year, and cross-border capital flows were stable and orderly. Preliminary statistics show that China's international balance of payments remained basically balanced in the first half of 2023, with a current account surplus of 146.8 billion US dollars, which is at a high level in the same period of history. The ratio to GDP is 1.7%, continuing to be in a reasonable and balanced range. Among them, the trade surplus of goods remains at a relatively high level, continuing to play a role in stabilizing the basic balance of international payments. Green products such as new energy vehicles, lithium batteries, and photovoltaics have abundant export momentum, supporting China's current account to maintain a reasonable surplus scale. The cross-border capital flow has stabilized and improved, with a net inflow of foreign capital in the first half of the year. Foreign investment has increased in net purchases of domestic stocks and bonds, with a net purchase of nearly 79 billion US dollars in domestic bonds.
Zheng Wei stated that the State Administration of Foreign Exchange insists on deepening reforms and promoting high-level opening up of cross-border investment and financing. Continue to deepen the two-way opening of the financial market, optimize the policy management of the Panda Bond and overseas institutional investor investment bond market, continuously improve the policy of opening up the domestic bond market to the outside world, and orderly promote the development of qualified domestic investment institutions' overseas investment business. At the same time, we will continue to optimize and upgrade the policy of centralized operation and management of cross-border funds in both domestic and foreign currencies for multinational corporations, enhance the freedom of cross-border fund operation for enterprises, and better support the development of the headquarters economy.
In addition, the State Administration of Foreign Exchange adheres to serving the real economy, strengthens the construction of cross-border financial service platforms, and promotes the deep integration of technological innovation and the real economy. And support exchange rate hedging for small and medium-sized enterprises, actively promote government bank enterprise cooperation, establish exchange rate hedging fund pools, guarantee credit reporting, etc., effectively reduce the cost of hedging for small and medium-sized enterprises, release exchange rate risk scenarios and foreign exchange derivative product application safety sets, and guide small and medium-sized enterprises to establish awareness of exchange rate risk.
