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Shenzhen embraces Hong Kong in financial markets integration plan, a prelude to easier capital controls
- Shenzhen blueprint welcomes Hong Kong-based players with five major areas of push, including cross-border banking and insurance business
- Decision cements stronger mainland-Hong Kong bond after China tightens grip on the Asian financial hub with security law
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Shenzhen, the richest of Greater Bay Area cities in Guangdong province, has outlined a 50-point blueprint to expand and upgrade its financial services sector to grease trade and capital flows with investors based in Hong Kong and elsewhere.
The plan includes 85 measures aimed at fostering financial innovation, widening market access to foreign investors, and strengthening market cooperation with Hong Kong, according to details posted on the Shanghai Securities News website on Wednesday.
The announcement coincided with a report published by a top research institute, which recommended upgrading the status of Shenzhen and three other cities to centrally administered municipalities, on par with Beijing and Shanghai.
The plan could give Shenzhen the clout that typically attracts significantly stronger policy support from the central government and greater allocation of resources to develop various investment projects in state-favoured sectors. The Silicon Valley of China is home to some of the world’s biggest companies including Tencent Holdings and Ping An Insurance.
The move to embrace Hong Kong comes amid China’s tightening its grip on the Asian financial hub since the promulgation of the controversial national security law in late June. It follows long-standing efforts to bridge the financial markets on both sides of the border through various so-called “Connect” programmes.
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