When it comes to Chinese financial services, the landmark regulatory decisions are made in Beijing and the new jobs tend to be created in Shanghai. Recent weeks have seen the launch of Hong Kong-Shanghai Stock Connect as well as new proposals to reform the Shanghai Free Trade Zone and introduce deposit insurance for banks.
The latest news of deregulation and job creation, however, comes from Qianhai, a special economic zone in western Shenzhen, only an hour’s drive from Hong Kong. Since 2012 Qianhai has been a test bed for China’s yuan liberalisation and financial reforms – Hong Kong banks are already allowed to lend offshore yuan to companies based in the zone.
Now the banks are moving into Qianhai itself, reports the South China Morning Post. On Sunday HSBC, Standard Chartered and UBS opened offices in Qianhai’s so-called “Enterprise Dream+Park”, which will eventually house more than 40 big companies. It’s unclear exactly how many people the three banks are employing in the zone, but it’s likely that most will be back-office staff. As we noted last year, Qianhai has the potential to develop into a major Asian operations hub Share on twitter because of its low business costs, proximity to Hong Kong and preferential income tax rate.
More significant for front-office jobs is what Qianhai has on its agenda for the future. The district released a plan late last week to deepen financial cooperation with Hong Kong, including a stock connection programme to link the Shenzhen and Hong Kong markets, reports CCTV. It also aims to set up a cross-border trading platform for securities and derivative products. Qianhai’s expected expansion won’t just create banking jobs. The proposals suggest further easing the requirements for Hong Kong-based insurers to open offices in the zone. Hong Kong insurance companies and other non-bank financial firms would also be allowed to lend yuan to Qianhai-based companies.
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