Shanghai in moves to encourage innovation
By Feng Jianmin |
February 1, 2012, Wednesday
|
Print Edition
Print Edition
SHANGHAI will encourage innovation by reducing administrative approval procedures and improving the taxation system as the city strives to expand its financial market and become a leading global yuan center by 2015, officials said yesterday.
New financial products will be allowed to trade on the market on a trial basis before getting the official nod from regulators, Fang Xinghai, director of the Shanghai Financial Services Office, told a press conference.
"The current approval procedures take too long to go through," Fang said. "If some products are getting a positive reaction from the market, they can be officially approved. If not, they will be removed from the market."
But he said regulatory standards would not be sacrificed under the new procedure, and market activities must be carried out within manageable risks.
The new method is likely to have an impact on the securities regulators, Fang added, without giving details.
The authorities will also improve the tax system to encourage innovation and attract foreign players, Fang said.
The remarks were made after China's top economic planner released details on Monday of its plan to make Shanghai the world's largest center for trading, clearing and pricing of the yuan by 2015.
The authorities are also aiming to nearly triple the non-currency financial transactions in Shanghai from 386.2 trillion yuan (US$61.2 trillion) to around 1,000 trillion yuan.
So far, Shanghai is leading other Chinese cities to allow some service companies to pay value-added tax instead of business tax.
The VAT system will enable companies to deduct some expenses on purchasing fuel, equipment and certain goods.
Shanghai's taxation bureau said last month that the coverage will be extended to the telecommunication and financial sectors.
To increase the variety and maturity of the financial market, Fang said more financial derivatives, including more short-selling tools, would be introduced "at certain stage of market development."
He also said Shanghai will "surely" launch the long-anticipated international board, but only when "market opportunities mature."
New financial products will be allowed to trade on the market on a trial basis before getting the official nod from regulators, Fang Xinghai, director of the Shanghai Financial Services Office, told a press conference.
"The current approval procedures take too long to go through," Fang said. "If some products are getting a positive reaction from the market, they can be officially approved. If not, they will be removed from the market."
But he said regulatory standards would not be sacrificed under the new procedure, and market activities must be carried out within manageable risks.
The new method is likely to have an impact on the securities regulators, Fang added, without giving details.
The authorities will also improve the tax system to encourage innovation and attract foreign players, Fang said.
The remarks were made after China's top economic planner released details on Monday of its plan to make Shanghai the world's largest center for trading, clearing and pricing of the yuan by 2015.
The authorities are also aiming to nearly triple the non-currency financial transactions in Shanghai from 386.2 trillion yuan (US$61.2 trillion) to around 1,000 trillion yuan.
So far, Shanghai is leading other Chinese cities to allow some service companies to pay value-added tax instead of business tax.
The VAT system will enable companies to deduct some expenses on purchasing fuel, equipment and certain goods.
Shanghai's taxation bureau said last month that the coverage will be extended to the telecommunication and financial sectors.
To increase the variety and maturity of the financial market, Fang said more financial derivatives, including more short-selling tools, would be introduced "at certain stage of market development."
He also said Shanghai will "surely" launch the long-anticipated international board, but only when "market opportunities mature."
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