China is going to open offshore currency market
China is going to open new offshore currency market. It is exact place is not defined yet though the possible cities to host it are Shanghai, Hong Kong and Tianjin. The currency of the country won’t become fully convertible one but nevertheless foreign companies as well as national ones will be able to trade it. Furthermore national institutions will get certain tax benefits in this case.
As for the location of the offshore market Tianjin has more chances than the other cities to become it. On the other hand according to the announcement of the China Daily Shanghai may win this game due to its great financial infrastructure.
As for the Hong Kong due to China Daily this city may be even excluded from the list of the considered locations for the future offshore market.
According to the announcement made by the People’s Bank of China it has already defined a special exchange rate policy department and will contribute to the creation of the offshore currency market to comply with the current process of Yuan internationalization. The main tasks of this new body will be foreign exchange administration, national forex market regulation, analyzing the situation at the global forex market and international capital flows as well as consultancy of the policy makers.
Due to Ma Ming a senior economist at the Beijing Institute of Technology the initial tasks of this body will be forex policymaking and State Administration of the Forex.
