Yang Zheng: The Hainan Free Trade Port will be built into a highland of financial double circulation

The source of this article: Times Finance Author: Yang Zheng

On October 10th, the first Jiangdong Financial Bay Summit Forum, hosted by the Enterprise Research and Consulting Center of China (Hainan) Reform and Development Research Institute and the Hainan Free Trade Port Financial Development Center, and hosted by Zhongxin Guohui (Hainan) Enterprise Management Co., Ltd., was successfully held in Haikou.

With the theme of "Opening a New Model of Global Fund Development to Help The Financial Innovation of Hainan Free Trade Port", the forum exchanged and discussed key issues such as financial and insurance policy innovation and fund investment in the free trade port, so as to build a platform and gather wisdom for promoting the financial policy innovation of the Hainan Free Trade Port and the international cooperation and exchange of the financial industry.

At the forum, Yang Zheng, vice president of the China (Hainan) Reform and Development Research Institute and director of the Enterprise Research and Consulting Center, proposed that at present, domestic residents have accumulated a huge amount of wealth to allocate overseas assets, and overseas non-residents also have a lot of wealth and hope to invest in high-quality Chinese assets.

According to relevant reports, the overall size of China's wealth management market in 2019 was 133.38 trillion yuan, and in the next 5-10 years, China's wealth management scale will maintain a growth of 10-12%, if it can attract 10% to Hainan for global allocation, there will be a capital increase of 20 trillion to 30 trillion yuan, which is equivalent to the scale of wealth management in Hong Kong in 2019 (28.7 trillion Hong Kong dollars).

As of the end of November 2020, the total deposits in the three Asian offshore RMB markets in Hong Kong, Taiwan and Singapore were 1.08 trillion yuan, and it is expected to reach a scale of 1.8-2 trillion yuan by 2025, which is twice the balance of RMB deposits in Hainan in 2020, but the offshore RMB market currently lacks rich investment tools and smooth investment channels.

In April 2021, the "One Bank, Two Sessions and One Bureau" issued the "Opinions on Financial Support for Hainan's Comprehensive Deepening of Reform and Opening-up" to support 33 measures to support Hainan's financial opening-up, creating conditions for Hainan to build a financial double cycle hub. In the next 5-10 years, Hainan is expected to become "a platform for Chinese residents to allocate global assets and a window for global residents to allocate Chinese assets", and an important fulcrum for promoting the internationalization of the RENMINbi in Asia.

The Hainan Free Trade Port should give full play to the location advantages and institutional advantages of the intersection of the double cycle, vigorously develop the two financial markets onshore and offshore, create a highland for Hainan's financial double cycle, give full play to the pilot advantages of the "double Q" fund (QDLP and QFLP) investment two-way channel and the public REITs fund, attract the orderly return of overseas RMB and US dollars, and support the development of Hainan's "3+1" key industries. It is recommended that relevant departments issue support policies and implementation rules as soon as possible, guide qualified enterprises to try first, use the overseas market to issue offshore RMB bonds, explore the introduction of overseas institutions to participate in the mixed reform of state-owned enterprises in Hainan, and achieve the "three introductions" goals of attracting foreign capital, foreign wisdom and international regulations. Make good use of the pilot policy of public REITs funds, select high-quality infrastructure assets in the province to accelerate the landing of REITs public funds in Hainan, enrich the channels and tools for offshore RMB investment, and become a highland for domestic and international capital double circulation.