Chapter 5.1: Banking Services for Foreign Investment Enterprises (FIEs)

HSBC

Further opening for China's banking sector

China has revealed more details of its plans to expand the opening up of the banking sector to foreign participation upon entry to the WTO. Restrictions on the operation of foreign banks will be gradually reduced over the next few years and as a result foreign banks are stepping up their efforts to secure a firmer foothold in China's banking sector in expectation of increasing business opportunities. The pace of the search for foreign investment in China's banks has accelerated, providing an alternative channel to foreign participation in the Chinese banking sector.

Following China's formal accession to the WTO, more details on the opening of its banking sector have been released, covering both foreign exchange and renminbi business. The major changes to the restrictions are scheduled to be completed by 2007.