Financial sector reform gains speed

China will give qualified foreign companies full-fledged licenses for providing financial services in the next three years, as part of its efforts to further open the sector to global investors, a top government official said on Friday.

"After removing the foreign equity limits for the banking industry, we will open the insurance and securities sectors in the next three years," Finance Minister Liu Kun said at a forum held by the ASEAN+3 Macroeconomic Research Office (AMRO) in Beijing.

The measures will benefit a broad range of foreign countries and people, and are an indication that China's gate will not close, but open further, said the minister.

As results of a series of policies announced earlier this year, China has opened its markets wider to the world, including cutting tariffs on some imported goods and lowering thresholds for manufacturing and services companies from abroad.

The average level of tariffs for imports has declined to 7.5 percent, said Liu.

Speaking at the forum, Chen Yulu, vice-governor of the People's Bank of China, the central bank, said that the government was committed to a "broader and deeper" two-way opening-up of the financial sector. He said that most of the opening-up policies that were announced at the Boao Forum for Asia in April have already started bearing fruit.

"China's opening-up of the financial sector has provided business opportunities for foreign financial institutions, as well as promoting reform and competition in the domestic financial markets," said Chen.

A working paper from AMRO, issued on Thursday, said that the 10 Association of Southeast Asian Nations member states (Indonesia, Thailand, Vietnam, Singapore, Malaysia, the Philippines, Myanmar, Cambodia, Laos and Brunei) have "benefited greatly from China's opening-up to trade and investment, while China's role in the region has been expanding and evolving".

The reforms over the first two decades－including in agriculture, the household responsibility system, State-owned enterprises, private sector development, establishment of special economic zones, and market reforms－have gradually but consistently moved the economy toward a market-oriented system and prepared for its fuller integration into the international trading system and investment, the paper said.

"The economic reform and opening-up journey has come a long way but is still not complete," said Khor Hoe He, AMRO's chief economist.

"Strengthened market-oriented reforms will improve the economic efficiency in China further," he said. "Fiscal policy can still play a significant role in facilitating and supporting supply-side reforms and providing counter-cyclical buffers against shocks. It can also play a more effective role in improving equity and inclusiveness, and in narrowing regional disparities."