After Chinese President Xi Jinping visited the Shenzhen special economic zone (SEZ) with a list of 40 reform measures aimed at spurring enterprises in the city into making it into a world-class innovation centre, more details and initiatives are expected to be announced.
Xi’s gesture and the measures represent the first time China has issued tailor-made guidelines for the development of a specific city. Over half of the measures require adjustments to existing laws and regulations, which give an indication of the strength and depth of the planned reforms.
In the fintech space, the list of measures, specifics to be announced, will aim to allow Shenzhen banks the ability to collaborate more with institutional investors and fintech service providers to diversify their business models with an eye to further boosting their innovation capabilities by creating cutting-edge projects. They will also push the integration of fintech and green finance.
The central government's support is not restricted to technology-related sectors. Currently the local government can issue bonds overseas as part of pilot project linked to a future nationwide reform of local government bond issuances. This is particularly relevant as the Covid-19 pandemic has prompted significant growth in this market. Total government bond issuance for this year, as of August, amounted to 4.96 trillion yuan, compared with 4.36 trillion yuan for 2019.
Other measures will include initiatives related to new stock index futures and a deep reform of the ChiNext stock market.