BEIJING, Jan 29: China will replicate some practices in Shanghai’s free trade zone to other parts of the country, the cabinet said, in its latest push to let markets play a bigger role in the economy. The expansion of practices include yuan, or renminbi, settlements under the current account for individuals and more freedom for foreign-funded firms to retain their foreign exchange capital without converting into yuan. Banks in Shanghai have been allowed to do cross-border renminbi settlement under the current account and for direct investment on the basis of ‘know your client’, ‘know your business’ and ‘due diligence.’
The cabinet also called for the opening of the services sector based on Shanghai’s experience, including allowing financial leasing firms to expand businesses and establishing firms to investigate foreign credit. Other practices included streamlining approval for the establishment of foreign advertising firms and reforms in customs supervision and quarantine procedures, the cabinet said.
China has already announced that it will set up three new free-trade zones in Guangdong, Fujian and Tianjin, modeled on Shanghai’s free trade zone.
China launched the Shanghai free trade zone in September 2013 and officials promised a far more open and streamlined environment for foreign firms to do business there, along with the relaxation of policies for a raft of service sectors.
(agencies)
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