— This is the script of CNBC's news report for China's CCTV on April 17, Tuesday.
We will analyze the influence of Chinese further open-up policy from these 2 angles: Finance and Industry. Some overseas analysts focus on the detailed policy in financial sector and sanction of offshore investors can take majority stake in financial institutions.
The open-up policy will introduce the advanced experience about company and risk management to China ; and accelerate the foreign capital flow into China market, S&P global rating indicated, what's more, the international life insurance company will act fastest to enter Chinese insurance market that is the fastest growing insurance market in the world. The insurance industry has fewer requirements for foreign capital.
The foreign capital has already made a great difference in current Chinese funds management industry, but it will speed up investing in Funds Company and Security Company.
In the first 3 quarters last year, 45 companies are joint ventures among the 113 funds companies in China whose asset management scale accounts for more than 40% in the whole industry. Along with the further open up of financial sectors, the joint ventures will gradually take more stakes.
This is complementary to other open-up measures in financial market, the 2nd angle I will introduce is enhance the connection between offshore stock market and inland stock market, including improve "Stocks" ,"Funds" 2-way transaction with HK and legal offshore investors plan, which is helpful to China to attract more international institution to do investment. The overseas investment banks hold a positive attitude to China market.
The Goldman Sachs is welcome to such policy and looking forward to see this kind of policy play a big role in China capital market. Citigroup has over 1 billion USD revenue that is related to Chinese business, thus, Citi would like to know more details about the following open-up policy.
The market concerns about the open up of finance, as well as the industry. That reflects on: the initiative to expand imports and relaxation of the joint ventures policy requirements. The import and export data of March that China published few days ago also reflects Chinese intention to expand export. The import and export that are priced in USD mixed, export dropped 2.7% and import increased 14.4% which is the first trade deficit since Feb.
Seasonal effect, devaluation of USD and worries about increased U.S. trade protectionism also influence it. But some people think China will enhance the support for import, reducing the trade surplus. The development of import and export trade in China will boost the B&R countries.
In the 1st quarter this year, the import and export trade between China and B&R countries advanced 12.9%, the import and export with Russia, Indonesia and Vietnam rose 20.5%, 20% and 30.7%, representatively.
China's initiative to expand imports lies in the reduction of tariffs on goods such as automobiles. This will greatly benefit the major international auto giants
On Apr 11th, the day after President Xi delivered speech at Boao Forum, the premium brand Lincoln under U.S. Ford Motor plans to launch 5 new models in 2022 in China to expand their market scale. Lincoln that's exported directly from the US is hard to compete on equal-footing with German brand and Cadillac that already built factory in China.
The reduction of car tariffs will greatly benefits car importers, and relaxation of joint ventures requirements is also a good new to overseas company who wants to establish sole ownership factory, the open-up in finance and industry is a new chance to international banking, insurance and automotive and other industry.