China's financial industry vows more in-depth competition and cooperation with global bodies

With the deepening of financial reform and opening-up, China's financial industry will carry out more comprehensive and in-depth competition and cooperation with global financial institutions in both domestic and international markets. Top experts concluded that precise identification, control and disposal of financial risks and maintenance of national financial security are crucial to improve China's global financial competitiveness and accelerate the going global process of China's finance.

The Fourth China Financial Security Forum, which is also The Sixth China International Finance 30 Forum, was co-hosted by Southwestern University of Finance and Economics, China International Finance 30 Forum and Division of International Studies, Chinese Academy of Social Sciences (CASS) in Beijing on Dec 25 and 26.

Shang Fulin, the chairman of the Economic Committee of the National Committee of the Chinese People's Political Consultative Conference, said that in recent years, the rapid development of the digital economy has accelerated digital reform in the financial field, which is both an opportunity and a challenge to China's financial security.

He said in this regard we should follow the basic laws of the financial industry and adhere to the mission of serving the real economy. We should firmly establish the concept of safe development, properly balance security with development and strengthen our ability to prevent and control financial risks. The development and application of science and technology has not changed the risk attributes of financial business, which actually has broken through the geographical and industrial restrictions of financial services and has complicated the potential systemic risks. Therefore, it is necessary to strengthen financial prudential supervision.

Jin Liqun, president of the Asian Infrastructure Investment Bank (AIIB), said that sometimes financial risks do not come from the financial system itself, while the external risks will affect the security of the financial system. Therefore, it is of great significance to identify risks and maintain a macro perspective in the process of risk management. Carefully observing the stability of the financial infrastructure, the effectiveness of the financial operation and the qualification of the practitioners are also very important to ensure financial security.

Under the current international situation, financial security is more likely to become a key issue in the big-power politics, and it is necessary to maintain financial security strategically. Upholding the multilateral framework of the international financial system and abiding by the rules of the international financial market is of great significance to ensuring financial security, he stressed.

Three financial reports, focusing on China financial security, global systemic risks and international financial competitiveness, were released on the forum.

Conducted by the Institute of Chinese Financial studies at Southwestern University of Finance and Economics, the China Financial Security Report in 2021 was released by the institute director Wang Qing. According to the report, financial security is a status description of the stable operation of the financial system, which has the connotation of maintaining core financial values. The report makes a comprehensive assessment of China's financial security in 2021. The data from the report show that China's financial security suffered a relatively big impact in 2020 and is still faced up with great challenges in 2021, while the overall risk is controllable.

Global Systemic Risk Trends Report for 2021-2022 said that though the global systemic risk is reducing in 2021, it will rise in 2022. When releasing the report, Fang Ming, director of Fintech Innovation Center at Southwestern University of Finance and Economics, said the report team found the pandemic will possibly come to an end by 2022, but this does not mean the global systemic risks will decline. Conversely, global systemic risk could rise as a result of excessively loose monetary policies by the Federal Reserve and other developed countries.

The third report, Global Financial Competitiveness Report 2021, aims to comprehensively measure the global financial competitiveness of 32 countries or regions by examining 57 indicators in five dimensions, including the competitiveness of financial industry, the competitiveness of currency, the competitiveness of financial infrastructure, the competitiveness of financial technology and the competitiveness in international financial governance.

Liu Dongmin, one of the main writers of the report and director of International Finance Research Division at the CASS, said that, at present, with its global competitiveness ever increasing, China is leading the world concerning the size of its financial system. While, compared to other developed countries, its currency competitiveness still needs to be improved. The construction of the indicator system for the evaluation of global financial competitiveness helps us to study and judge the competitive advantages and disadvantages of a country's financial system, which can provide a reference for the policy makers and the financial innovation institutions.

Meng Zhen contributed to this story.