Strengthening Regulation of Cross-Border Financing

来源: CHINA FOREX 2016 Issue 1 作者:PBOC Announcement Gr
The establishment of a macroprudential regulatory system for cross-border financing is related to the scale of institutional capital and entails restrictions on total financing volume. It is a system

The establishment of a macroprudential regulatory system for cross-border financing is related to the scale of institutional capital and entails restrictions on total financing volume. It is a system that is convenient for government departments as they manage cross-border financing and it is a system that can be adjusted according to economic conditions as well as changes in the balance of payments and the nation's ability to make repayments. It also allows unified management over local and foreign currency borrowings.

The People's Bank of China unveiled its Announcement of the People's Bank of China on Launching Pilot Projects for Expanding Full-coverage Macro Prudential Regulation over Cross-border Financing in January. The announcement applied to 27 financial institutions and some enterprises registered in free trade zones in Shanghai,Tianjin,Guangzhou and Fujian province. The free trade zones rolled out pilot projects on unified management over local and foreign currency financings in compliance with the central bank's policy. According to the policy announcement,pilot financial institutions and enterprises can make cross-border financings in both local and foreign currencies without needing to obtain approval from the central bank or the State Administration of Foreign Exchange (SAFE),as long as the financing amount is below a ceiling set according to their levels of capital or net assets.

New Ways to Manage Capital Flows

The People's Bank of China and SAFE have been working actively in the past few years to promote pilot reforms in the management of cross-border financing in order to quicken the pace of renminbi convertibility and reform the current management model under which all cross-border financings are supposed to be approved. Three kinds of pilot management models have been launched and the first was the   model unveiled by SAFE in the Shanghai Pilot Free Trade Zone. There is also a management system for external debt which largely relies on corporate self-discipline. This model was devised for some multinational companies in the Shanghai Pilot Free Trade Zone as well as the Zhongguancun National Innovation Demonstration Zone in Beijing,the Zhangjiagang Free Trade Zone in Jiangsu province,and the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone in Shenzhen. There is also a project for borrowing renminbi from overseas,a model launched by the central banks in industrial parks in Qianhai,Kunshan,Suzhou,the Sino-Singapore Tianjin Eco City,and development zones in border areas in Yunnan and Guangxi provinces. 

本文是付费内容,请先 登录数字阅读账户订阅数字杂志