Nation firm on opening-up pledges
Despite short-term fluctuations, China will stick to its pledges to continue to promote opening up in the financial sector as the nation has sound economic fundamentals, according to senior officials.
Speaking at a panel discussion on Tuesday during the World Economic Forum in Tianjin, Fang Xinghai, vice-chairman of the China Securities Regulatory Commission, said he is quite upbeat about China's efforts to continue promoting the opening up of the financial sector at the time when there are no systematic risks in China's capital market.
Foreign investors look to China's long term economic fundamentals, rather than short term fluctuations, according to Fang.
His remarks came after China announced a number of measures to ease or remove limits on foreign ownership in China's financial sector, which have raised some concerns over possible shocks to China's domestic financial market hit by possible large amount of capital fluctuations.
Liu Shijin, vice-chairman of China Development Research Foundation and a central bank policy advisor, said efforts to promote opening up can be facilitated a little, because China is capable of cushioning external shocks.
"External challenges would pose a limited impact to the Chinese economy," he said.
The US government has announced additional 10 percent tariffs on about $200 billion worth of Chinese goods starting from next week, pointing to escalating of trade frictions between the two nations.
"The direct impact on the Chinese economy from trade friction is rather limited. Major negative hit is about expectations, reflected by recent fluctuations in the A-share market and currency market," Liu said, adding the key is to pursue high quality growth.
The new tariff measures are expected to have a negative impact of around 0.3 to 0.5 percentage points on China's GDP growth over the next year, but fiscal and policy easing will largely offset these effects, leaving China's real GDP growth estimation unchanged, at 6.6 percent in 2018 and 6.4 percent in 2019, according to Lillian Li, a vice-president at Moody's Investors Service.
Helen Zhu, head of China Fundamental Equities with BlackRock, said people are looking to opportunities in the Asian market that are not necessarily available elsewhere.
Foreign buying of Chinese stocks via the Shanghai-Hong Kong Stock Connect reached 399 million yuan last week, and funds via the Shenzhen-Hong Kong Stock Connect reached 395 million yuan ($57.5 million) during the period, data from Wind Infor showed.
