China won’t falter in pursuit of two-way opening-up of economy, finance sector

By Hu Weijia Source:Global Times Published: 2018/4/25 23:33:42

The Chinese government is likely to introduce more detailed regulations to realize further opening-up in 2018, with the financial sector listed as one of the policy priorities.

China has doubled quotas for the Qualified Domestic Limited Partnership (QDLP) trial programs in Shanghai and Qualified Domestic Investment Enterprise (QDIE) trial programs in Shenzhen, allowing fund companies to invest a total of $10 billion in assets overseas, Bloomberg News reported Wednesday. The move sent a signal that the government's grip on cross-border capital outflows might be further relaxed this year. The government is likely to simplify outward investment while also guarding against investment risk.

There has been much discussion about measures to ease limits on foreign ownership of financial services groups so they can have easier access to the Chinese market, but less attention has been paid to China's "going out" strategy to boost outward investment. The structure of the nation's opening-up policy is not one-way; it's always a two-way street. China is practicing a "bringing in, going out" policy and the two parts of the nation's opening-up are equally important.

China will deepen economic and financial reforms and further open its door to foreign countries. It is understandable that the world would like to focus more on the agenda for the opening-up of China's markets. However, to understand the open-door policy, it is important to know that Chinese investors are eager to go out too.

With a Chinese investment boom, some countries are preparing to limit investment from China in a vast swath of areas such as finance and advanced technology. Such restrictions on investment will affect the outflow of Chinese capital.

Without a "going out" strategy, the idea of opening China's door will go nowhere. China is at a critical moment as it shows its determination to build an open economy. For China's economic partners, this means huge opportunities, as well as a serious test of reciprocal opening-up.

With a rise of trade protectionism, the US is shutting its doors to the world. China will spare no efforts to follow its timetable to push forward opening-up and economic reforms, but it will not be smooth sailing.

China's economic relationships with Western countries have become increasingly complicated and unequal. It's normal for each side to seek the maximum advantage for its domestic companies. In this context, even slight progress will be a valuable achievement.

The author is a reporter with the Global Times.


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