China’s new financial regulator has made new pledges to make regulations more transparent, stable and predictable, in a bid to restore investor confidence after a plunging stock price and high-profile personnel changes. This is the latest of several attempts to do so.
“[We’ll] “We will strengthen the interconnectivity of domestic and foreign financial markets and better facilitate cross-border investment and lending,” the committee said in the article, detailing how to make China a “financial superpower.”
These signals come at a time when foreign investors, including greenfield capital and portfolio holders, are hesitant to decide on their next move and concerned about the future of China’s policy choices.
The world’s second-largest economy achieved gross domestic product (GDP) growth of 5.2% in 2023, but market sentiment has been dampened by a prolonged slump in the real estate industry, poor employment statistics and mounting local government debt. remains sluggish.
Amid these factors and rising geopolitical tensions, foreign investors have turned to other markets over the past year, with the country’s annual net foreign direct investment (FDI) intake in 2023 being the highest in 30 years. was pushed to its lowest level.
“Be careful, we’re playing with money”: Is China uninvestable or invaluable?
“Be careful, we’re playing with money”: Is China uninvestable or invaluable?
Direct investment debt, which represents both FDI inflows and outflows, increased by US$33 billion last year compared to 2022, according to data released by the State Administration of Foreign Exchange on Sunday. This is an 82% decrease from the previous year and the lowest annual level for the investment index since 1993.
However, Foreign Exchange Regulatory Authority spokesperson Wang Chunying said foreign securities investment inflows into China improved in the fourth quarter of 2023, with net inflows reaching a two-year high. Ta.
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Hong Kong stock market falls below the 15,000 yen level, the lowest in 15 months
Hong Kong stock market falls below the 15,000 yen level, the lowest in 15 months
“This indicates that more foreign capital is flowing into China to invest in businesses and allocate RMB assets,” he said in a statement, adding, “The overall domestic and foreign environment is improving. China’s international balance of payments will stabilize in 2024, as the balance of payments will improve to a certain level,” he added.
The index rose more than 1% on Monday and more than 0.2% on Tuesday after the long Lunar New Year holiday saw better-than-expected consumer spending driven by tourism and movie sales.
China’s middle class seeks safe haven for wealth amid economic slowdown
China’s middle class seeks safe haven for wealth amid economic slowdown
The CFC vowed to make Shanghai more competitive and influential and strengthen Hong Kong’s position as an international financial center, while pledging greater openness and transparency.
He also emphasized the importance of a “high level of security” and pledged to bring all financial activities under control.
The commission said in an article that authorities should “identify, warn, expose and respond to risks as soon as possible to prevent small things from escalating and big things from exploding.”
Managing financial risks is critical to China’s future development, as the stability of the Chinese government is tested by its heavy government debt, rampant corruption, and financial services that lag behind rapid advances in technology and manufacturing. We believe that this is extremely important.