The way forward: Pedestrians cross a road in Pudong’s Lujiazui Financial District in Shanghai. According to a plan released by the government, Pudong will carry out large stress tests and explore effective ways for megacity governance. — Bloomberg
SHANGHAI: The newly released plan depicting the development path for Pudong New Area in the next five years will help the area fulfill its role as a pioneer of China’s socialist modernisation, say experts.
The plan will push Pudong New Area to seek more breakthroughs in terms of institutional reform and opening up, they said.
The general offices of the Central Committee of the Communist Party of China and the State Council, China’s Cabinet, released an implementation plan on Monday for Pudong’s pilot comprehensive reform between 2023 and 2027.
The plan states the area will be provided with more autonomy in the reform of key areas. Comprising 23 detailed measures, the plan states that Pudong will carry out larger stress tests and explore effective ways for megacity governance.
By extending the reform results to a wider area, Pudong should serve as an important demonstration zone while China grows into a modern socialist country.
Quan Heng, Party secretary of the Shanghai Academy of Social Sciences (SASS), said the plan centres on the institutional opening-up in Pudong.
“By relaxing foreign entry thresholds for telecommunication services and healthcare in an orderly manner, by better aligning the negative list for foreign investment with market entry requirements and by exploring a digital economy regulation system, we can expect more rules, regulations and standards adopted in Pudong to be in line with internationally accepted ones,” he said.
The plan focuses on Pudong’s strengths in finance, talent, data flows, high-tech industries like biomedicine and artificial intelligence, and urban governance, said Xie Yiqing, an associate researcher from the Institute of China Studies at the SASS.
According to the plan, efforts are to be made to roll out option products for the technology-heavy Star Market on the Shanghai Stock Exchange.
Asset management companies will be supported to further fine-tune their domestic and foreign capital investment channels.
Their businesses related to capital sources, investment methods and capital management should be further optimised.
Meanwhile, more convenient settlements in both yuan and foreign currencies should be provided for cross-border technology trade.
Attempts should be made to use the digital yuan for trade settlements, eCommerce payments, carbon trading and green power trading, the plan stated.
Sun Lixing, a researcher at the Institute of World Economy of the SASS, said efforts should be made to accelerate innovation in the financial sector, especially at the institutional level.
Mature markets show that financial innovation can serve as an effective tool to hedge and diversify risks, he said.
According to the local government work report released by the Shanghai municipal government on Tuesday, the city attracted the regional headquarters of 65 new multinational corporations last year, swelling the total to 956.
Previously released official data showed that Pudong was home to 449 multinational corporations’ regional headquarters at the end of 2023, 30 of which were set up over the past 12 months.
Companies or institutions with their headquarters in Pudong are encouraged to develop offshore economic and trade activities, according to the new plan.
Wang Zhiyi, a specialist in cross-border finance at the Shanghai United Assets and Equity Exchange, said that offshore economic and trade activities include trade in goods, trade in services and processing trade.
The new measures will give full play to the strengths of Shanghai’s free trade account, which allows more flexible capital flows for offshore businesses and can both manage risks and seek innovations.
In July 2021, the central authorities released a guideline to support Pudong’s high-level reform and opening-up, and said that the area should pioneer socialist modernisation.
In December, a framework plan was released to advance high-level institutional opening-up in the China’s Shanghai Pilot Free Trade Zone, which is included in Pudong. — China Daily/ANN
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