- The Hainan province will turn into a free trade zone, according to an April 14 document jointly released by the Communist Party’s Central Committee and the State Council.
In a bid to develop the sports industry in the FTZ, the government will allow gambling activities on major sports events to take place in Hainan, making it the first Chinese province to permit gambling, and only the second region in China to do so after the Special Administrative Region of Macau.
Hainan will also build a free trade port that focuses on promoting high-tech, tourism and other services. The central government will devolve power to local officials and set up a development fund to support the port. It expects the FTZ and the port to be fully accomplished and become a leading province in driving the country’s economic growth by the middle of the century.
Belt and Road:
- The IMF and the People’s Bank of China launched the China-IMF Capacity Development Center on April 12. The centre will provide macro-financing training for officials from countries along the Belt and Road, including China, Christine Lagarde, managing director of the IMF, said in a speech the same day.
But Lagarde also expressed reservations about the impact of the Belt and Road Initiative (BRI).
“The BRI can provide much-needed infrastructure financing to partner countries,” she said. “However, these ventures can also lead to a problematic increase in debt, potentially limiting
other spendingas debt service rises, and creating balanceof payment challenges.”
Countries with high public debt will need to be careful when borrowing to support the BRI, she added. Such vigilance will prevent China and other BRI countries from entering into agreements that may cause financial
difficulties,and is good for both sides.
- China will make iron ore futures available to international market participants on May 4, the China Securities Regulatory Commission said in an April 13 statement. The move will come just over a month after China launched RMB-denominated crude oil futures.
- Cross-border RMB trade and investment settlements stood at Rmb1.06tr ($168.6bn) and Rmb685.6bn in the first quarter, according to statistics released by the PBoC on April 13.
A breakdown of the numbers shows that RMB settlement for cross-border trade in goods and services were Rmb797bn and Rmb261.9bn, up from Rmb795.4 and Rmb198.8 in the first quarter of 2017, according to figures published by the PBoC year. Settlement for RMB direct outbound and inbound investments stood at Rmb217.9bn and Rmb466.6bn, respectively, up from Rmb64.1bn and Rmb177.6bn in the first quarter of 2017.
- The State Bank of Pakistan has given the greenlight for Bank of China’s local branch to provide RMB settlement and clearing services in Pakistan, the central bank said in an April 11 statement. BOC can open RMB accounts for local banks, handle RMB remittance from and to China, and provide RMB liquidity to the local interbank market, said the statement.
- Chinese and Russian companies are increasingly using the renminbi or the ruble, instead of the dollar, to settle trades, the Russian media reported last week, citing the Russian Central Bank. In 2017, 9% of supplies from Russia to China were paid for in the ruble, and Russian companies paid for 15% of Chinese imports in the RMB, up from 2% and 9% just three years ago, claimed the report.
- The PBoC has renewed its swap agreement with the central bank of Albania for three years, keeping the size of the swap line at Rmb2bn, the Chinese central bank said in an April 13 statement.
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