BEIJING– China plans to ease limitations on foreign ownership of monetary services groups, the government announced Friday, a long desired action for those looking for higher access to the huge Chinese market.
The news came at a briefing to mark the end of President Trump’s state go to– a see where he publicly pushed Beijing for better market gain access to. It is not yet clear, however, whether the Trump administration was involved, or merely taken advantage of the timing of the announcement.
Zhu Guangyao, vice minister of finance, said comprehensive guidelines are still being prepared, however foreign firms will now be allowed to own up to 51 percent in securities, fund management and futures trading joint endeavors. The previous cap was 49 percent.
He likewise stated China prepared to remove caps on foreign stakes in Chinese banks. At present, a foreign investor can hold a 20 percent stake in a Chinese bank and a group of foreign financiers can hold a 25 percent stake.
The modifications could be great news for U.S. companies, though experts stated they have to understand more about the rules and the timing of the changes.
“It is a favorable advance,” said Paul Gillis a teacher at Guanghua School of Management in Beijing. “Fifty-one percent JV’s offer control to the foreign investor, although the devil is in the details as to how management and the board are structured.”
“I eagerly anticipate seeing the details, as opening up the monetary sector in specific could greatly improve the allotment of funds and assistance China’s future development,” said William Zarit, chairman of the American Chamber of Commerce in China.
“These constraints, and many others yet to be addressed, have been preventing financial activity in China for far too long,” he said.Andie Xie, an independent economic expert based in Shanghai, was more hesitant. He predicted the impact of the modifications would be “minimal. “” It’s symbolic in the sense
that the Chinese markets has become much tougher for financial institutions to split, even without barriers, since the marketplace is so competitive now.”Neither Xie or Gillis saw it as a substantial concession to Trump. Xie saw the statement as a nod
to criticism from businesses in the United States and Europe, who have in current years accused China of protectionism, not a basic modification. ” China wants to throw bones to foreign visitors,
so it was anticipated that Trump would be provided some great news, said Gillis,”I question it is significant, nevertheless. It certainly won’t produce any U.S. jobs.” Shirley Yang and Yang Liu contributed from Beijing.President Trump speaks throughout a business event with Chinese President Xi Jinping at the Great Hall of the Individuals in
Beijing on Thursday.(AP )