Lujiazui Forum 2018: Participants discuss financial reforms

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02:14

The 2018 Lujiazui Forum is now underway, with Chinese central bank governor Yi Gang giving the audience a preview of what's ahead in financial reforms.

YI GANG, GOVERNOR PEOPLE'S BANK OF CHINA "The PBOC will take measures to support Shanghai's role as the pioneer of financial reform. We will support the trials of cross-border yuan operations, the use of Free Trade Accounts in the free trade zone, and gradually loosen stock holding limitations for foreign financial institutions in China."

YANG CHENGXI SHANGHAI "For the past year China has seen multiple new developments in its financial sector. Participants here all have their picks of the most noteworthy reform measures since 2017."

ALEXANDER HOFFET CONSUL GENERAL OF SWITZERLAND IN SHANGHAI "There will be opening up of foreign financial institutions to acquire majorities in Chinese banking institutions and so on. So that's certainly big news."

MARK YEANDLE Z/YEN GROUP "It's about the currency. It's about RMB and making that more tradable in more venues."

Both of these measures were launched in the Shanghai Free Trade Zone. City authorities announced last month that they would support foreign banks in launching more operations, and will also expand the flexibility of the zone's Free Trade Accounts. It's an experimental program that lets investors transfer funds between foreign accounts and their own accounts in the FTZ.

CALVIN FU, CHIEF CHINA REPRESENTATIVE ABU DHABI GLOBAL MARKET "Recent reforms such as the coming of CDR, and also the new QFII, RQFII policies yesterday, have all shown that China is integrating its global economics and financial governance."

The CDR, or China Deposit Receipts, will create listings of giant tech firms. Many are eagerly awaiting the CDR's debut.

WANG JUNJIN, CHAIRMAN JUNEYAO GROUP "The launch of the CDR is a plus for companies, especially new types of companies."

Some investors are concerned, since companies that are expected to issue the CDR are relatively big tech firms. They say new issuance might have a diluting effect on the market and adversely affect stock prices. 

WANG JUNJIN, CHAIRMAN JUNEYAO GROUP "There's no need to worry. When there is new supply, there will naturally be a new market created."

It is still unclear whether the CDR will be included in major Chinese indices. But regardless, experts say it will influence how many investors organize their portfolios. YCX, CGTN, SHANGHAI.