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Forum gives boost to city plan to become world financial hub
By Zhang Fengming, Winny Wang and Leo Zhang |
May 16, 2009, Saturday
|
Print Edition
Print Edition
CITY leaders and central-government regulators yesterday reaffirmed their support of Shanghai's goal to become a major international financial powerhouse while overseas experts provided advice on how to make it happen.
"As the global financial scenario changes and China's economic status is boosted, Shanghai must make every effort to use this precious chance to develop itself into an international financial center," Shanghai Party Secretary Yu Zhengsheng told the Lujiazui Forum 2009 yesterday. "It is the inevitable choice for Shanghai's long-term sustainable development."
This year's gathering of more than 300 government officials, business executives and scholars - billed as China's Davos - will focus on ways to help Shanghai achieve its development plans amid the global economic downturn.
The State Council - China's Cabinet - issued a guideline in late March aimed at developing Shanghai into a major global financial and shipping hub by 2020, giving the city priority to carry out financial innovation as well as other preferential policies.
"We will work with the central government in the effort for Shanghai to become the pioneer and test site for China's financial reform and innovation," Yu told the forum at the Pudong Shangri-La hotel.
Top regulators renewed the central government's commitment to the Shanghai plan. Central Bank Governor Zhou Xiaochuan said the People's Bank of China will strongly back Shanghai's efforts on the financial front.
"The central bank and other regulators are willing to fully support the Shanghai government to step up financial center development by creating more incentives," Zhou said.
Additional effort is needed, he said, citing issues such as human resources, tax mechanisms, infrastructure and information systems. He also said the legal system, accounting rules, corporate governance and initial public offerings should be modified to achieve global acceptance.
Other regulators were also optimistic about the city's prospects.
"Shanghai has a relatively complete financial system, and it's a strategic and realistic move to speed up the establishment of a (world financial) center against the financial crisis," said Liu Mingkang, chairman of China Banking Regulatory Commission.
He said innovation is crucial for helping China's financial sector combat the world downturn, adding that all financial institutions need to enhance innovation in risk management.
Wu Dingfu, chairman of the China Insurance Regulatory Commission, said the insurance sector will play an important role in building the local financial hub.
"We are focused on developing Shanghai into an innovation and R&D center for insurance products, an insurance management and back-up service center and as a pilot city for insurance capital reforms," Wu said.
Foreign experts also offered their advice at the forum. Ronald P. O'Hanley, vice chairman of the Bank of New York Mellon, suggested that Shanghai speed up the use of securities such as fixed-income products to catch up with Wall Street and the City of London.
"The current leading financial hubs are where most of the issuance of securities takes place. There should be an acceleration of products allowed in Shanghai," he said.
Party Secretary Yu acknowledged that Shanghai faces great challenges in dealing with the global financial crisis as exports slump and industrial output declines. But he also noted that the overall economic situation is now "better than expected."
Shanghai's exports dropped 26.2 percent year on year in April to US$25.13 billion, the sixth consecutive monthly decline, compared with a decline of 16.4 percent in March.
But the city's industrial output posted hopeful performance. The decline in production eased to 5.2 percent last month, compared with a 7.1 percent loss in March.
"As the global financial scenario changes and China's economic status is boosted, Shanghai must make every effort to use this precious chance to develop itself into an international financial center," Shanghai Party Secretary Yu Zhengsheng told the Lujiazui Forum 2009 yesterday. "It is the inevitable choice for Shanghai's long-term sustainable development."
This year's gathering of more than 300 government officials, business executives and scholars - billed as China's Davos - will focus on ways to help Shanghai achieve its development plans amid the global economic downturn.
The State Council - China's Cabinet - issued a guideline in late March aimed at developing Shanghai into a major global financial and shipping hub by 2020, giving the city priority to carry out financial innovation as well as other preferential policies.
"We will work with the central government in the effort for Shanghai to become the pioneer and test site for China's financial reform and innovation," Yu told the forum at the Pudong Shangri-La hotel.
Top regulators renewed the central government's commitment to the Shanghai plan. Central Bank Governor Zhou Xiaochuan said the People's Bank of China will strongly back Shanghai's efforts on the financial front.
"The central bank and other regulators are willing to fully support the Shanghai government to step up financial center development by creating more incentives," Zhou said.
Additional effort is needed, he said, citing issues such as human resources, tax mechanisms, infrastructure and information systems. He also said the legal system, accounting rules, corporate governance and initial public offerings should be modified to achieve global acceptance.
Other regulators were also optimistic about the city's prospects.
"Shanghai has a relatively complete financial system, and it's a strategic and realistic move to speed up the establishment of a (world financial) center against the financial crisis," said Liu Mingkang, chairman of China Banking Regulatory Commission.
He said innovation is crucial for helping China's financial sector combat the world downturn, adding that all financial institutions need to enhance innovation in risk management.
Wu Dingfu, chairman of the China Insurance Regulatory Commission, said the insurance sector will play an important role in building the local financial hub.
"We are focused on developing Shanghai into an innovation and R&D center for insurance products, an insurance management and back-up service center and as a pilot city for insurance capital reforms," Wu said.
Foreign experts also offered their advice at the forum. Ronald P. O'Hanley, vice chairman of the Bank of New York Mellon, suggested that Shanghai speed up the use of securities such as fixed-income products to catch up with Wall Street and the City of London.
"The current leading financial hubs are where most of the issuance of securities takes place. There should be an acceleration of products allowed in Shanghai," he said.
Party Secretary Yu acknowledged that Shanghai faces great challenges in dealing with the global financial crisis as exports slump and industrial output declines. But he also noted that the overall economic situation is now "better than expected."
Shanghai's exports dropped 26.2 percent year on year in April to US$25.13 billion, the sixth consecutive monthly decline, compared with a decline of 16.4 percent in March.
But the city's industrial output posted hopeful performance. The decline in production eased to 5.2 percent last month, compared with a 7.1 percent loss in March.
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