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Shanghai FTZ Sets Out Financing Hub Vision

by Lorys Charalambous, Lowtax.net, Cyprus
06 April, 2017

The China (Shanghai) Pilot Free Trade Zone has announced plans to become an investment and financing hub for China's "Belt and Road" trade initiative connecting Asia, Europe, Africa, and their adjacent seas.

The plans include attracting sovereign funds from countries along the Belt and Road regions to invest in onshore yuan-denominated assets, furthering the yuan's use as an "international" currency.

The announcement follows the issue of a new reform plan for the Zone by China's State Council, which includes the establishment of a new free trade port inside the Zone, and initiatives to attract foreign investors to issue yuan-denominated financial products, and serve projects in the "Belt and Road" initiative.

The China (Shanghai) Pilot Free Trade Zone also announced plans to encourage Shanghai-based insurers to offer financial products to provide risk protection services for key projects alongside the Belt and Road, including construction insurance, life insurance, and cargo insurance.

The Zone will also participate in the country's plan to launch a bond allowing easier access for foreign investors to trade onshore bonds.

The China (Shanghai) Pilot Free Trade Zone was launched on September 29, 2013, and offers companies a number of tax preferences. It comprises a bonded area, high-tech park, financial area, and an export processing zone.

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