China's financial authorities voice support for Belt and Road Initiative

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The Chinese government is giving full support to enterprises willing to invest in the Belt and Road countries, with Chinese financial regulators backing up financial cooperation for projects under the China-proposed Belt and Road Initiative.

Top officials from the central bank, securities watchdog, banking regulator, insurance commission as well as Forex administration expressed their support for the initiative in articles published in the latest issue of China Finance, the central bank's biweekly finance professional magazine.

"There’s relatively great financing demand," Zhou Xiaochuan, Governor of the People's Bank of China (PBOC) wrote. The demand for funding infrastructure projects is huge. China's financial institutions can help fill that gap, and the country has set an example for extending credit, he said.

Proposed by Chinese President Xi Jinping in 2013, the Belt and Road Initiative is strengthening infrastructure and connectivity from Asia to Europe and Africa via a wide network of projects. Leaders from 28 countries will gather in Beijing for a Belt and Road forum on May 14-15.

PBOC: Belt-Road financing should use local currencies

Zhou Xiaochuan, Governor of the People's Bank of China /VCG Photo

Governor Zhou pointed out investment and financing for projects under the initiative should be market-oriented, and that using local currencies instead of dollars or other major currencies for investments can help ensure financial stability and reduce the risk of exchange-rate fluctuations.

China has designated renminbi clearing banks in 23 countries and regions, with seven along the Belt and Road, and has largely developed its Cross-border Interbank Payment System (CIPS) with many participants from the Belt and Road countries. The clearing banks and the CIPS can offer more clearing alternatives for overseas market players.

CSRC: Stock markets tapped to finance projects

Fang Xinghai, Vice Chairman of the China Securities Regulatory Commission /VCG Photo

China encourages high-quality local companies to raise capital in both China's A-share and overseas stock markets, said Vice Chairman of the China Securities Regulatory Commission (CSRC) Fang Xinghai.

Companies are allowed to issue bonds to support the Belt and Road projects. Last month, Russian aluminium giant United Company RUSAL issued a 10 billion yuan (1.4 billion US dollar) panda bond, the first of its kind for Belt and Road projects.

The CSRC has signed memoranda of understanding on securities cooperation with 26 countries and regions along the Belt and Road. China will also speed up the development of offshore yuan markets and further open up its financial markets to foreign investors, Fang added.

SAFE, CBRC, CIRC to promote easier trade and investment

Pan Gongsheng, Administrator of the State Administration of Foreign Exchange /VCG Photo

Pan Gongsheng, Administrator of the State Administration of Foreign Exchange, said reform of the foreign exchange management system will be deepened for easier trade and investment. He noted Chinese companies investing in real and legal Belt and Road projects will gain support.

Wang Zhaoxing, Vice Chairman of the China Banking Regulatory Commission /VCG Photo

Wang Zhaoxing, Vice Chairman of the China Banking Regulatory Commission (CBRC), said the CBRC will give instructions to Chinese banks in planning their Belt and Road projects and help optimize their branches established in the Belt and Road countries.

Chen Wenhui, Vice Chairman of the China Insurance Regulatory Commission /VCG Photo

Chen Wenhui, Vice Chairman of the China Insurance Regulatory Commission (CIRC), said the CIRC‍ will allow insurance firms to provide capital to public-private partnership projects related to the Belt and Road Initiative.