The Chinese government is set to introduce a new policy for local authorities and businesses in the recently expanded Free Trade Zone (FTZ) in Shanghai. The updated policy is aimed at further opening opportunities for the financial sector, the Southern Weekly reported.
Sun Jiwei, a deputy director of the Shanghai FTZ administration, said in an interview on July 7 that the State Council is set to approve a new policy in their next meeting, following claims that a new policy for the Shanghai FTZ surfaced two months ago.
Sun said that the new draft rules will ease restrictions on overseas investments of individual investors and allow free convertibility of capital accounts.
The Shanghai FTZ opened in Sept. 2013, becoming the first FTZ in the country to be used as a pilot area for economic and trade deregulation.
The government added three new FTZs this year --Fujian, Guangdong and Tianjin--and also expanded Shanghai FTZ's area from 28.78 to 120.72 square kilometers, the report noted.
The Shanghai FTZ now covers 80 percent of Pudong District, where the financial sector, IT industry and advanced manufacturing sector are located.
Zhang Yong, head of the policy bureau at the Shanghai FTZ administration, said that residents in the FTZ will enjoy imported goods that are 10 percent to 30 percent cheaper, including services provided by foreign firms, such as medical, travel and financial.
According to the report, one of the key tasks of China's FTZs is to implement financial reforms, which distinguish them from FTZs of other countries.
The Shanghai FTZ introduced in May 2014 had free trade accounts, which enabled companies to transfer funds between China and other countries without necessarily getting permission for each transaction.
In addition to this, the Shanghai FTZ has allowed banks operating in the area to conduct cross-border loans, which are offered at lower borrowing rates.