To Accelerate Shenzhen-Hong Kong's Financial Connectivity, 30 Financial Measures Have Been Enacted

SHENZHEN,China,Feb. 27,2023 -- Qianhai now appears to be the first stop for Hong Kong-invested financialinstitutions to enter the mainland,and Qianhai has made another breakthroughin financial innovation. On February 23,the Opinions on Providing FinancialSupport for the Comprehensive Deepening of Reform and Opening Up of the QianhaiShenzhen-Hong Kong Modern Service Industry Cooperation Zone (hereinafterreferred to as the Opinions) was officially released. With it,Qianhai willplay a greater role in helping Hong Kong integrate into the overall nationaldevelopment,according to the Authority of Qianhai Shenzhen-Hong Kong ModernService Industry Cooperation Zone.

The Opinions set out 30 financial measures,covering financial services relatedto people's livelihoods,mutual access between financial markets,thedevelopment of the modern financial industry,facilitation of cross-bordertrade,investment,financing,and strengthening of cooperation in financialsupervision. More specifically,the newly-released measures include helpingHong Kong residents to open accounts with mainland banks,facilitating HongKong professionals to practice in the mainland,allowing financial securitiesinstitutions to carry out direct financing in Hong Kong,and pilot the transferof private equity and venture capital shares. The 30 measures have furtherdefined the path to achieving a higher and deeper level of financial opening upand cooperation with Hong Kong.

"The introduction of the 30 measures marks another round of promotion of mutualfinancial market access between Shenzhen and Hong Kong," said David Liao,co-chief executive of the Hong Kong and Shanghai Banking Corporation LimitedAsia-Pacific,in a recent interview,"The measures will lay the foundation forthe convergence of financial rules and mechanisms in the Greater Bay Area,andallow the exploration of new paths for the high-level opening up of themainland's financial industry."

Dah Sing Bank Shenzhen Branch,China's first bank with a dual operationlicense,was opened,and UBS Qianhai Wealth Management Co. Ltd.,the firstwholly foreign-owned wealth manager in the Greater Bay Area,was opened. DBSBank became the largest shareholder in the Shenzhen Rural Commercial Bank,andHSBC increased its stake in HSBC Qianhai Securities to 90%. A number ofinternationally renowned financial institutions,including Standard Chartered,settled in Qianhai through QFLP.

In recent years,Qianhai's financial industry has constantly aligned withinternational standards,and Qianhai has continued to highlight its function asa demonstration window of the opening up of the financial industry in China. Interms of innovation for cross-border finance,Qianhai was the first in thecountry to implement six cross-border RMB services,namely cross-border RMBloans,cross-border bond issuance,cross-border RMB foreign currency cashpooling,cross-border equity investment,cross-border asset transfer,andcross-border financial infrastructure. Qianhai will continue to expand intoother cross-border services. In 2022,Shenzhen and Hong Kong promulgated thefirst 18 measures for supporting venture capital investments in Qianhai,andQianhai was to establish an international Shenzhen-Hong Kong venture capitalcluster. The Qianhai Mercantile Exchange of HKEX Group has had a total of over130 billion yuan of spot transactions. So far,247 financial institutions havesettled in and signed with Qianhai Shenzhen-Hong Kong International FinancialCity,among which Hong Kong and foreign-funded institutions account for 30%.

Now,the Opinions have advanced new goals for the opening up of Qianhai'sfinancial industry. By 2025,Qianhai will establish and gradually improve uponthe policy and management system to focus on the expansion and opening up ofthe financial industry and the internationalization of RMB,accomplishhigh-level mutual access with Hong Kong's financial market,improve the systemfor monitoring,preventing,and resolving financial risks,and give finance amore prominent role in supporting the development of the Guangdong-HongKong-Macao Greater Bay Area. By 2035,a higher level of financial openness,based on the negative list,will be achieved,the cross-border capital flowwill be more efficient and convenient,the financial rule system will be inline with the international system,and the financial environment will reach aworld-class level. By then,Qianhai will play a greater role in leading theopening of the national financial industry.

The plan is for Qianhai to put together an implementation task list for the Opinions to set up a task plan,roadmap,timeline,and accountability system.Qianhai will strive to hold a Shenzhen-Hong Kong Financial Forum,strengthenthe Shenzhen-Hong Kong financial regulatory cooperation system,preventcross-border financial risks,and promote the further opening up anddevelopment of Qianhai.

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