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Xinhua | Updated:2017-09-25 09:37HANGZHOU — China should open its financial sector as it is needed to realize sustainable economic growth, a leading Chinese think tank said Saturday.China has made significant headway in opening up its financial sector over the past 40 years, but the pace of reform hampers the healthy operation of the economy, the China Finance 40 Forum (CF40) said in its latest Jingshan Report.”The pace of financial opening up has fallen behind the real economy. … China has every reason to carry forward reform to realize sustainable economic development, prevent systematic financial risks and play a greater role in global economic governance,” the report said.The report calls for giving overseas-funded banks “pre-establishment national treatment,” which means giving equal treatment to overseas and domestic companies even before they make investments.Overseas securities firms and life insurers should be allowed to operate sole-funded ventures in China. The asset threshold of overseas banks should be removed, according to the report.Currently, overseas investment banks can only hold minority stakes of local securities in joint ventures, and have been largely excluded from the secondary-market trading in Chinese debt and equities, as well as from managing money for wealthy clients.Chinas central bank governor Zhou Xiaochuan said in June that opening up helped to build a strong and competitive financial sector in China, and that protectionist behavior limiting the participation of foreign players in China would lead to laziness and weakness, causing poor competitiveness and hurting the industrys development.Domestic commercial banks have learned a lot from competition, with competition from foreign-capital banks helping Chinas financial sector in terms of product evolution, market building, business models and management expertise, Zhou said.As part of financial liberalization, the report calls for more flexibility of the exchange rate regime of the RMB, asking for a greater role for market forces.Since the end of 2016, expectation of RMB devaluation had largely disappeared, with the real economy running steadily.The authorities should seize on good timing to advance reform and not miss the boat again. It could be a clear signal of Chinas opening up and reform and will enhance Chinas representation and voices in global financial affairs, the report said.In addition, the report underscores the importance of advancing the internationalization of the RMB in a stable manner and building a cross-border capital flow oversight framework from macro and micro perspectives.The credit rating system should be opened up to overseas investors. A comprehensive commercial financial service system should be established to facilitate the smooth operation of domestic industrial restructuring and the Belt and Road Initiative.Fully aware of the risks, the Chinese leadership is focused on tackling deep financial risk, sparing no efforts to address financial irregularities.During the two-day National Financial Work Conference in July, the Chinese leadership highlighted three tasks: making the financial sector better serve the real economy, containing financial risks and deepening financial reform.The authorities will set up a committee under the State Council to oversee financial stability and development, and the central bank will play a stronger role in macro prudential management and guarding against systemic risks.The CF40 is a non-government, non-profit and professional think tank dedicated to policy research on economics and finance. It was founded in 2008 and operates as a club that consists of forty influential experts each aged around 40 years old.It aims to enhance the academic foundation of Chinas finance, provide high-quality research on emerging financial issues and promote financial reform and development.Related StoriesFinancial sector to open wider, Goldman Sachs saysChinas financial sector more open to fintech: CFA InstituteNew committee key to financial sectorGuarding against risks for a sound financial sectorPresident Xi urges financial sector to better serve real economyPhotoNew iphones go on sale, with short lines at storesHot cakes: Big demand for 72-year-olds hand-made mooncakesWeird, cool and funny bikes in the worldUnable to hear or talk, tattoo artist creates magic with handsGold and silver mooncakes look more alluring than real onesChinese company rushes to make Halloween productsMost Viewed in 24 HoursState Council NewsPremier: Prudent supervision needed for e-commercePremier Li: Inclusive regulation boosts new businesses, employmentTop 10Top 10 best-performing companies in AsiaEditors picksChinese brands capture 25% of Russian smartphone market in Q2Leshi urges LeEco founder Jia to fulfill loan commitmentChina DataTimeline of policy supports for the rental home marketQ&A With CEOServing in the name of progressBehind an advertising visionSpecial2017 Summer DavosChinas Q1 economic dataBACK TO THE TOPHOMECHINAWORLDBUSINESSLIFESTYLECULTURETRAVELWATCHTHISSPORTSOPINIONREGIONALFORUMNEWSPAPERChina Daily PDFChina Daily E-paperMOBILECopyright 1995 -var oTime = new Date();
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