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China Insights

SwedCham China Insights for the week of August 23-27, 2021

Top news of the week:

  • CSRC re-emphasizes commitment to opening up
    August 23, 2021

    On 20 August, China Securities Regulatory Commission (CSRC) held a mid-year work meeting on monitoring and regulation. The CSRC chairman Yi Huiman delivered a report titled “upholding progressing with stable paces and achieve high quality development of the capital market with deepening of reform and opening-up”, making it the second time within a month for the authority to emphasize China’s dedication to opening up.

  • Minister of Commerce highlights opening-up and importance of FTZs
    August 24, 2021

    On 23 August, Minister of Commerce, Wang Wentao spoke at a news conference in Beijing about the ongoing mission to expand economic opening up and continue to pilot new methods of reform in FTZs and target areas alongside aligning with international rules for trade and economics. Wang echoed the sentiments of top leaders, saying that opening-up is the path China must follow to achieve national prosperity. Wang also stated that the negative lists would continue to be shortened to allow more foreign direct investment across sectors.

  • Shanghai releases plan to become international financial center by 2025
    August 25, 2021

    On 24 August, the Shanghai city government introduced their plan for development of Shanghai as an international financial center during the 14th Five-Year Plan period of 2021-2025. In this new period of development, the city set out six specific goals. To achieve these goals, Shanghai will optimize the financial services industry through digitalization and green finance development, while also stimulating the development of sci-tech.

  • State-owned Assets Supervision and Administration Commission (SASAC) re-evaluates SOEs
    August 26, 2021

    On 25 August, the State-owned Assets Supervision and Administration Commission (SASAC) held a media briefing session to introduce the status of the three-year SOE reform actions, showing that the central SOEs are accelerating their path to restructure and integrate, and the market may expect a new central SOE group to make its debut soon. SASAC once again mentioned that there will be new central SOE groups, which will focus on logistics, power transmission and distribution, strategic resources, grain reserve and processing, and marine engineering equipment sectors.

  • Common prosperity stokes panic for upper classes
    August 27, 2021

    On 26 August, Han Wenxiu, Executive Deputy Director of the General Office of the Central Financial and Economic Affairs Commission (the top financial organ within Communist Party of China), attended a press conference to explain “Common Prosperity” which has led to panic amongst the upper classes. Han publicly stated that the notion of common prosperity is not the government’s goal to “rob the rich to help the poor” but rather a mid-long-term goal which targets to eliminate unbalanced gap between regions and urban/rural areas and not to eliminate any income gap between individuals. No concrete legislation has been passed on this policy directive.

Insight of the week:

On 24 August, the Shanghai city government introduced their plan for development of Shanghai as an international financial center during the 14th Five-Year Plan period of 2021-2025. Wu Qing, the city’s Vice Mayor, noted that by 2020 Shanghai had established itself as an international financial center in line with China’s economic strength and the international status of the RMB, laying a solid foundation for further development. Data released at the end of 2020 had the total capitalization of shares listed on the Shanghai Stock Exchange ranked third in the world, while IPOs in 2020 saw funds raised and overall turnover ranking first and fifth globally. In this new period of development, the city set out six specific goals: to enhance the development of “two centers” – a global asset management center and a financial technology center, to consolidate the position of “two hubs” – an international green financial hub and a hub for the cross-border use of the RMB, and to establish “two highlands” – for international financial talent and the financial business environment. The city also aims to consolidate its central position in RMB financial asset allocation and risk management and enhance its global resource allocation function and lay a solid foundation for developing as an international financial Centre of global significance by 2035. Shanghai expects to see the cumulative issuance of panda bonds (RMB-backed bonds from non-Chinese issuers) reach RMB 700 billion by 2025 and hopes to become home to around 50 leading fintech enterprises in this time. To achieve these goals, Shanghai will optimize the financial services industry through digitalization and green finance development, while also stimulating the development of sci-tech.

About Kreab

Founded in Stockholm, Sweden, in 1970, Kreab is a global strategic communications consultancy with offices in 25 countries, serving over 500 global clients. Kreab advises on communication issues of strategic importance in business, finance, and politics, helping clients solve complex communications challenges and achieve their strategic goals. The Kreab Beijing team is well known for its track record of helping clients manage and strengthen their reputation through services spanning corporate communications, financial communications, public affairs, and social media. Contact Kreab at kchina@kreab.com, follow Kreab on WeChat (ID: KreabChina), or visit Kreab’s website at https://www.kreab.com/beijing.