Money
Financial industry must develop
By Xiao Li (China Daily)
Updated: 2011-06-11 09:23
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Bank logos along Beijing's Financial Street. The assets of foreign banks only account for about 2 percent of the total market share of China's banking industry.?[Photo/China Daily] |
Former deputy minister pushes for higher level of overseas investment
TIANJIN - China needs to further develop and open its financial industry to better facilitate the country's overseas investment, a former senior trade official said on Friday.
"China needs to strengthen its service industries, especially the financial industry, to accelerate the pace and raise the quality of its overseas investments," said Long Yongtu, the former deputy minister of commerce and chief negotiator of China's entry of the World Trade Organization.
Long made the remarks at the Fifth China International Private Equity Forum (CIPEF), an annual direct investment and financing event in China.
Long noted that China has long possessed a high level of foreign exchange reserves, which is unsustainable and has put great pressure on the country's overall fiscal and monetary policies.
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Long pointed out that China needs to strengthen its financial industry by empowering domestic investment banks and the financial intermediary sector to help enterprises find investment opportunities overseas.
"China should have its own Goldman Sachs and Morgan Stanley. It is a big challenge for our financial industry," he said.
In the meantime, Long called for a gradual opening-up of China's financial sector to foreign institutions and domestic private enterprises. At present, the assets of foreign banks only account for about 2 percent of the total market share of China's banking industry.
"We should gradually loosen the restrictions on foreign financial institutions entering the Chinese market," he said. "Also, domestic private enterprises should be granted greater access to the domestic financial industry."
CIPEF, an annual forum held in Tianjin that attracts businesses, investors, financial institutions and private-equity firms from home and abroad, serves as a financing platform for domestic businesses, especially small and medium-sized enterprises (SMEs).
It has provided SMEs with an effective way of accessing capital from private-equity (PE) funds, venture-capital firms, and other financial institutional investors, said Huang Xingguo, the mayor of Tianjin.
In recent years, the local government has dedicated itself in building the city into a center for PE investment funds.
Currently, more than 1,200 funds and management enterprises are registered in the city with total registered capital of more than 230 billion yuan ($35 billion), according to the local government.
"We are actively creating favorable conditions to attract PE funds and built the city into a hub for management, trading, and training of private-equity investment in the country," Huang said.
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