(Greenwich, 9/23/2006) The occasion for the conferences in China where I spoke over the past 2 weeks is China’s WTO requirement to fully open its financial sector to foreign firms by the end of this year. Although there is a lot of arm wrestling going on to define “fully open” the government is making great progress. The latest advance is the new law now being considered by the National People’s Congress, China’s lawmaking body, to establish financial leasing firms. You can read about it in a Forbes article by clicking here.
These change are creating interesting opportunities for both foreign and Chinese companies to expand the financial service sector. I spent a lot of time with the Governors of both the Haidian District (Beijing’s Silicon Valley) and Xicheng District (Beijing’s financial district.) Both are committed to policies that will bring new sources of financing to China’s dynamic private companies. Today, there is ample funding for large, state-owned companies but very little venture capital, growth capital, and working capital for the small and medium size enterprises (SME’s) that are driving China’s growth.
I am also working with Hunan University (where the Yuelu Academy, China’s oldest standing universoty was founded in 978 AD), where I am a Visiting Professor in the Finance School, to help design the consumer and business credit risk measurement systems that banks will need to bring credit cards and other forms of SME financing to China. Will keep you posted on our progress.
Stay tuned for further events this fall.
JR
