China deepens financial cooperation with BRI partner countries

Editor's note: Li Juncheng is an assistant researcher at the Institute of Finance & Banking, Chinese Academy of Social Sciences. The article reflects the author's opinions and not necessarily the views of CGTN. It has been translated from Chinese and edited for brevity and clarity.

The 2023 Annual Conference of Financial Street Forum opened in Beijing on November 8 with the theme “Better China, Better World: Enhancing Financial Openness and Cooperation for Shared Growth and Mutual Benefits." 

This year's annual conference has brought together representatives from over 30 countries and regions around the world to discuss current economic and financial focal points.

As part of the agenda of the annual conference, a parallel forum centered on "Promoting the Belt and Road Initiative to Enhance Regional Cooperation and Mutual Development" has garnered significant attention.

During the third Belt and Road Forum for International Cooperation held in Beijing in mid-October, China outlined eight actions to support the high-quality development of the Belt and Road Initiative (BRI), emphasizing China’s support for building an open world economy and enhancing the construction of multilateral cooperation platforms in the financial sector and other areas with Belt and Road partner countries.

The convening of the annual meeting is of great significance for furthering financial cooperation between China and Belt and Road partner countries.

A strong voice for multilateralism

The annual conference has showcased to the international community China's policy stance and specific actions in practicing multilateralism and adopting a mutually beneficial and open strategy. It reflects China’s steadfast commitment to multilateralism.

Fostering communication channels

This vast world is home to diverse civilizations. Guided by an open, inclusive, cooperative and win-win philosophy, the annual conference assembles various parties to explore ways to deepen cooperation and address challenges. 

Freedom of expression and equal exchanges of different value systems and the dissemination and sharing of various kinds of wisdom and experiences contribute considerably to advancing the collective development and collaborative progress of the world’s financial sector.

Sharing dividends of China's development with the world

The recently concluded Central Financial Work Conference highlighted, with equal emphasis, both "bringing in" and "going global," and we should steadily expand institutional opening up in the financial sector and facilitate cross-border investment and financing, to attract more foreign financial institutions and long-term capital to invest and operate in China.

The convening of the annual conference has showcased to the world the outcomes and measures of China's financial reform and extended a sincere invitation to countries worldwide to share the dividends of China’s development. It will bring more opportunities for advancing economic and financial cooperation and mutual prosperity among nations.

Fruitful results of financial cooperation between China & BRI countries

Over the past decade, China and Belt and Road partner countries have actively engaged in various forms of financial cooperation, yielding a series of fruitful results in promoting currency circulation, perfecting investment and financing mechanisms, and improving financial risk prevention and control.

Regarding currency circulation, as of September this year, China had signed bilateral currency swap agreements with 30 partner countries and established renminbi clearing arrangements in 17 partner countries.

Meanwhile, the Cross-Border Interbank Payment System, a financial market infrastructure dedicated to cross-border renminbi payment and clearing, has provided Belt and Road partner countries with secure, efficient, convenient, and low-cost fund clearing and settlement services.

Data shows that in the first three quarters of 2023, the cross-border renminbi payments and receipts between China and Belt and Road partner countries amounted to 6.5 trillion yuan, a year-on-year increase of 19 percent. 

In the field of investment and financing system construction, the high-level multilateral financial cooperation platforms between China and Belt and Road partner countries have demonstrated significant effectiveness, and financial market connectivity has been advancing at an accelerated pace.

The Silk Road Fund, established with contributions from China and the Asian Infrastructure Investment Bank (AIIB), and jointly founded with relevant countries, has evolved into a pivotal platform for deepening financial cooperation and realizing capital flows between Belt and Road partner countries. Data reveals that as of the end of June 2023, AIIB had approved 227 investment projects, with a total investment of $43.6 billion. The Silk Road Fund had signed contracts for 75 investment projects, pledging an investment of about $22.04 billion.

Meanwhile, China has continuously improved the bilateral opening-up arrangements of its financial market, actively promoted cross-border bilateral investments and resource allocation with Belt and Road partner countries, and focused on enhancing the level of interconnectivity of the capital markets.

In terms of financial risk prevention and control, China and Belt and Road partner countries have been advancing their cross-border cooperation and exchanges on financial regulation.

To date , China has signed memorandums of understanding or cooperation agreements on regulatory cooperation with regulatory authorities in 55 Belt and Road partner countries, continuously expanding cooperation in areas such as the sharing of financial regulatory information.

In addition, China has established bilateral and multilateral dialogue mechanisms at different levels with multiple Belt and Road partner countries, thus strengthening the dynamic monitoring of macro risks through bilateral and multilateral cooperation and elevating the level of cross-border supervision.