China policy round-up: Beijing Covid-19 outbreak ‘under control’, financial chiefs signal further market reform, Trump threatens Sino-US ‘decoupling’
GlobalCapital, is part of the Delinian Group, DELINIAN (GLOBALCAPITAL) LIMITED, 4 Bouverie Street, London, EC4Y 8AX, Registered in England & Wales, Company number 15236213
Copyright © DELINIAN (GLOBALCAPITAL) LIMITED and its affiliated companies 2024

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement
Asia

China policy round-up: Beijing Covid-19 outbreak ‘under control’, financial chiefs signal further market reform, Trump threatens Sino-US ‘decoupling’

Shanghai_Lujiazui_575px_adobe_19June20

In this round-up, officials claim the second wave of local infections of Covid-19 in Beijing is under control, top Chinese financial regulators gather and deliver speeches at a high-profile event in Shanghai, and US president Donald Trump says that a “complete decoupling” from China is on the table.

The second wave Covid-19 outbreak in Beijing has been brought under control, Wu Zunyou, the chief epidemiologist at China’s Centre for Disease Control and Prevention, said on Thursday.

Between June 11 and June 18, Beijing reported 183 new cases, including 25 on Thursday, mostly of which could be traced back to a food market in Fengtai District. The city is in a partial lock down, with hundreds of flights cancelled and more than 10 highways in and out of the city closed.

*

China plans to waive interest-free government loans extended to certain African countries that are due by the end of 2020, president Xi Jinping said in a China-Africa video summit, dedicated to tackling the coronavirus, on Wednesday. China will also work with other countries to relieve the financial stress of African countries hit the hardest by Covid-19, he added.

Xi promised that African countries would be among the first to benefit from the Covid-19 vaccines China is developing, once they are ready for use. Xi also pledged to help African countries improve their public health systems, including by building hospitals.

*

China’s financial leaders gathered at the opening of the Lujiazui Forum, a major financial event for the country, in Shanghai on Thursday. They included the country’s vice premier Liu He; Guo Shuqing, chairman of China Banking and Insurance Regulatory Commission (CBIRC); Yi Gang, governor of the People’s Bank of China (PBoC); Pan Gongsheng, director of the State Administration of Foreign Exchange (Safe) and deputy governor of the central bank; and Yi Huiman, chairman of the China Securities Regulatory Commission (CSRC).

At the forum, CBIRC’s Guo said more insurance money should be used to purchase medium- to long-term bonds from corporations. The regulator will soon announce six measures to support the development of onshore capital markets, including adding new institutional investors by approving more wealth management subsidiaries from banks and more insurance asset management companies, while allowing foreign institutions to set up wealth management companies with controlling stakes.

*

The CSRC’s Yi said the securities watchdog will continue strengthening its collaboration with financial regulators overseas, particularly in cracking down on cross-border securities crimes. It will also work together with its foreign counterparts for better supervision of the auditing of global listed companies.

He said more work will be done on the Shanghai-London Stock Connect, Shanghai-Hong Kong Stock Connect, Shenzhen-Hong Kong Stock Connect, as well as the ETF Connect, backing Hong Kong’s status as an international financial hub.

The CSRC will further develop the Shanghai Stock Exchange’s Nasdaq-style Star Market, including introducing a market making system and coming up with guidelines for post-IPO financings on the tech and innovation board.

China will firmly push forward these market reforms with zero tolerance on financial frauds, Yi added.

*

PBOC governor Yi Gang said Shanghai is becoming a fintech centre and a centre for the renminbi asset allocation.

He also reviewed the central bank’s monetary policy for the first half of the year. In the second half, the central bank will use monetary policy to make sure liquidity is at a “reasonably ample” level, with new renminbi loans to reach Rmb20tr for the full year and the total social financing to increase by Rmb30tr, he said.

*

China is home to the world’s second largest bond and stock markets with a combined size of Rmb160tr, and the allocation of renminbi assets by international institutional investors has reached Rmb6.4tr after a 20% average annual growth, said Pan Gonsheng.

He added that China will accelerate the opening up of the onshore market, expand the Qualified Domestic Limited Partnership (QDLP) and Qualified Foreign Limited Partner (QFLP) pilot programmes, and encourage the launch of more innovative renminbi products.

*

US president Donald Trump tweeted on Thursday afternoon US time that a “complete decoupling” from China remains a policy option for the US.

*

Yang Jiechi, senior Chinese diplomat and director of the central government’s Office of Foreign Affairs met with US secretary of state Mike Pompeo in Hawaii this week, the Xinhua News Agency reported.

According to the spokesperson for the Ministry of Foreign Affairs, Zhao Lijian, the pair touched on “important and sensitive” issues regarding Taiwan, the Hong Kong Special Administrative Region, and the Xinjiang Uyghur Autonomous Region.

*

Zhao, at the foreign ministry, called the arrest of Meng Wanzhou, the former chief financial officer of Huawei Technologies, a “political case” during a Monday press conference.

A reporter from Chinese state media Global Times asked for Zhao’s comment after a report disclosed by a Canadian court last Friday showed that the US Federal Bureau of Investigation had given the Canadian Security Intelligence Service a heads-up regarding Meng’s arrest at the Vancouver airport in December 2018. The FBI was not present at the arrest, which was conducted by Canada’s border security agency.

“[The report] fully exposed the political motive of the US side to oppress China’s hi-tech companies like Huawei,” Zhao said. “Canada has been acting as an accomplice in this case.”

Gift this article