China’s central bank has established an integrated information backup system at Shanghai Pilot Free Trade Zone to oversee cross-border financial activities within the area and ensure post-stage management, a central bank official said on Friday, Oct. 23, the China Daily reported.
Zhang Xin, deputy director at the Shanghai branch of the People's Bank of China, said that all financial institutions in Shanghai have been integrated into the system, which enables companies, through the free-trade accounts, to settle trades and investments in local and foreign currency, as well as access trading platforms for transactions such as gold and certificate of deposit.
"The account functions will expand further to support innovative cross-border investment and financing services and enable China's financial institutions to better serve our real economy and compete globally," Zhang told China Daily during the media briefing.
In his visit to the Shanghai FTZ on Sept. 19, Premier Li Keqiang pledged to promote financial reform and open up support for real economy.
Zhang said that since the FTZ founding in Sept. 2013, about 35,000 corporate free-trade accounts have been registered in the pilot zone, adding that central bank's early warning information will help ensure that risk will be isolated.
According to Zhang, companies at the Shanghai FTZ are currently allowed to invest and finance at the offshore market no more than two times of its capital funds.
"Once their activities exceed such limit, the system will detect and we will step in," Zhang added.
"The system will facilitate cross-border activities and act as a strong backup for post-stage management," the director explained.