Greater Financial Role for Belt and Road Initiative

By Staf Reporter Guo Meng



Greater Financial Role for Belt and Road Initiative

By Staf Reporter Guo Meng

On July 1， 2015， Bank of China Abu Dhabi Branch held the Belt and Road RMB bond issuing ceremony in Dubai Financial Exchange， UAE.

Nowadays， China is enjoying rapid economic growth and a significant rise in GDP. It has grown into a prominent force in the global economy. Tanks to the Belt and Road Initiative， it has forged closer cooperation in economy with ASEAN and maintained a rapid upward momentum. As an important carrier of economic cooperation， financial cooperation plays a key role， and the two sides have carried out continuous exploration in the fnance sector with notable achievements. As an important link， finance leverages and connects China with ASEAN. Seizing the opportunity and seeking development are key for China and ASEAN to take advantage of new opportunities.

Finance Takes the Lead

The Belt and Road Initiative opens another channel for Chinese capital to invest abroad，and creates more opportunities for cooperation with countries along the Belt and Road in industry， trade， investment and finance. To support the initiative， finance follows the general approach and principle of “planning prioritized with fnance taking the lead”. Eforts are being made to plan and integrate the resources of all sides， push fnance to “go global”，try new approaches in financial schemes and modes of investment and fnancing， intensify the synergistic efect of fnance， serve the real economy and expand the layout for fnance to serve the Belt and Road Initiative to the utmost.

In terms of infrastructure construction， fnance fully plays the leveraging role to promote rapid growth and accumulation of capital in a short time， efectively resolve the bottleneck of capital shortage， accelerate infrastructure development in neighboring countries in transportation， information network and financial institutions， and build the scheme of interconnection in the stock and bond markets. Tis helps achieve “inter-connectivity” in a real sense， providing a more practical and conve-nient service system for bilateral cooperation.

With regard to the trans-regional systems，efforts are being made to improve resource allocation in the financial system， create new approaches in the concept of cooperation and mode of financing， work hand in hand with other fnancial institutions to set up new platforms for financial cooperation， such as the Asian Infrastructure Investment Bank，BRICS Development Bank， Silk Road Fund and China-Eurasia Economic Cooperation Fund， and promote fnancial cooperation in a comprehensive， open and diversifed way.

Regarding capital export and service，fnance takes the lead to support the Belt and Road construction， guide the foreign exchange capital export， drain some foreign exchange reserves， enhance coordination in financial regulation， and provide effective and convenient financial services in terms of capital input， currency exchange， monetary settlement， hedging and bank insurance.

Open Financial Services

Finance has a close relationship with trade. Shanghai is regarded as the biggest trading port in China as well as the one with the biggest throughput in the world. As a pilot in China's economic reform， Shanghai releases the “agglomeration effect” in confidence boosting，capital attraction， internationalization of fnancial market and innovation in fnance. As for this international fnancial center standing on the crossroads where the Belt and Road and the Yangtze River Economic Belt meet， Shanghai channels more energy into trade facilitation and inter-connectivity. On the Belt and Road map， the trade volume of 64 countries and regions with Shanghai accounts for 23 percent of its total foreign trade.

An international fnancial center is a concentrated embodiment of the comprehensive fnancial strength of a country that never slows the pace of construction and development. As a pilot of foreign investment and trade in China， Shanghai is home to transnational corporations， R&D centers and innovative service centers. Introducing international fnancial institutions， Shanghai has developed its advantage of scale in international trade to be a “springboard” for Chinese capital to go global. The BRICS Development Bank and many other foreign financial institutions are headquartered in Shanghai.

Bank of China Vientiane Branch ofcially opened on March 26， 2015.

Shanghai is committed to growing into a core node city of global investment trade. At present， it has built up a complete financial institutional system， and developed a modern financial market system across the country comprising stocks， bonds， currency， foreign exchange， commodity futures， financial futures， gold and insurance. Te building of the financial market system in Shanghai serves system reform in the Chinese fnancial industry， as well as ofering a sound market system platform for innovation in various kinds of international fnancial institution and fnancial instruments. At the same time， as the RMB “goes global”，the financial market system in China keeps improving. As the pioneer of the current fnancial development nationally， Shanghai has undertaken dramatic reforms in interest rate， exchange rate and other financial fields， and expanded the scope and scale of currency swap and settlement with countries along the Belt and Road.

Finance is helping to leverage and link China with ASEAN. Seizing the opportunity and seeking development are key for China and ASEAN.

Blood Transfusion

Enhancing regional economic cooperation is an important booster and magnifier to lead and guide the Belt and Road construction. At present， China has maintained a rapid development in finance. Its financial institutions show enormous increase in vigor and vitality. Financial system functions have entered a new stage of development and innovation by closely meeting changes in demand of the real economy serving the Belt and Road Initiative. The financial cooperation involves three features， including multi-layered trading sites，various trading products and diversifed trading mechanisms.

With the vision of the Belt and Road，China works to strengthen the financial cooperation with countries concerned，to explore and practice the new mode of capital operation for co-contribution and common beneft，cultivate new economic growth points，increase the economic endogenous impetus，promote the investment and financing mechanism， upgrade the radiation， innovation， influence and resource allocation of international fnance， and beneft to integrate resources and complement advantages among countries.

In the process of pushing currency to“go global”， eforts are being made to build a multi-layered regional currency cooperative system， continue to enhance the system of currency stabilization， build the system in investment， financing and credit， and lift China-ASEAN economic cooperation to a new level.