China relaxes banking control regulations for foreign firms
(10 November 2017 – China) Foreigners will be able to own larger stakes in Chinese financial firms under major reforms announced in China, aimed at making the country a major global banking hub.
The move provides overseas firms an opportunity to expand and win a larger market share of the country's multitrillion-dollar financial service market. The announcement follows meetings between United States President Donald Trump, and China’s President Xi Jinping.
President Xi is driving economic reforms by opening up China's capital markets, internationalising the yuan and seeking technical know-how by pursuing massive inbound and outbound investments.
The changes, which take effect immediately, include raising the limit on foreign ownership in joint-venture firms involved in the futures, securities and funds markets to 51 percent, from 49 percent now.
Vice-Finance Minister Zhu Guangyao told a reporters that China is "formulating a timetable and road map for financial sector reform and opening up".
The plan to ease ownership curbs comes as Beijing faces mounting pressure from Western governments and business lobbies to remove investment barriers and onerous regulations that restrict overseas companies' operations.
Foreign firms are still small players in the financial sector, but the sheer size of the market is a big lure for overseas players.
Foreign banks account for just 1.4 percent of the total 181.7 trillion yuan (A$35.7 trillion) of banking assets in China, according to recent studies.