An executive meeting of the State Council passed the Overall Plan for the Pilot Free Trade Zone in Shanghai on July 3. The plan will soon be published after the final revision.

The pilot free trade zone conforms to trends in the global economy and trade development. It is a major step toward more proactive reform and opening-up. Its target is to deepen reform; speed-up transformation of government functions; promote the opening of the service sector; and actively explore new ways for the government's management of economy, trade and investment. It hopes to make itself into a duplicable and promotable example for the national economy.

The plan covers a wide range of areas, such as liberalization of interest rates, convertibility of the renminbi exchange rate, opening of the financial industry, innovation of financial products and off-shore businesses.

According to the plan, renminbi under financial accounts will be gradually convertible in the Shanghai Free Trade Zone. Corporations can exchange renminbi freely in the future. It is likely that the goal will be divided into several steps. For example, the first step could be to promote the overseas investment and financing of the domestic capital.

A total of 21 incentive methods will be set for the zone, aiming at attracting foreign investment in financial services, commodity trade and cultural industries.