On February 5th, a company in Nansha Free Trade Zone planned to purchase masks from abroad with the supplier demanding payment within the same day. The Guangdong Branch of the Agricultural Bank of China consequently set up a FT (Free Trade) account for the company and ensured a timely foreign exchange transfer, which allowed for a swifter delivery of supplies To combat the epidemic.
This kind of cross-border financial connectivity in the Guangdong-Hong kong-Macao Greater Bay Area (GBA) offers opportunities in the fight against the epidemic, said the company.
A number of policies implemented for financial connectivity
Huafa Group, with its headquarter in Zhuhai, issued the first Lotus bond to be held by non-Macao enterprises last year, which makes domestic enterprises possible to issue bonds in Macao.
The close cooperation in the finance sector between Guangdong, Hong Kong and Macao brings new opportunities to the development of the GBA. Last year, Guangdong and Macao jointly established a 20-billion-yuan cooperative development fund in Hengqin, Zhuhai.
Residents are also witnessing first hand the increasing convenience that the financial connectivity of the GBA brings. For instance, a cross-border vehicle insurance system was established to enable car owners to purchase car insurance anywhere in the Chinese mainland, Hong Kong and Macao.
Mobile payment has also been facilitated. The Bank of China provides a ‘cross-border wallet’ service for Macao residents to make purchases in the mainland without needing to register a mainland account, starting from last December.
According to data from the Guangdong Financial Supervisory Authority, as of the end of December 2019, the settlement amount between Guangdong, Hong Kong and Macao had hit 14.72 trillion yuan. There are 257 Guangdong enterprises listed in Hong Kong, the greatest number from any Chinese province.
Enhanced connectivity will promote more innovation
Since the implementation of the outline development plan for the GBA, there have been many breakthroughs, commented Ba Shusong, the executive director of HSBC Financial Research Institute, Peking University and chief China economist of Hong Kong Stock Exchange. There will be more innovative policies to come.
The combination of finance and technology will further financial cooperation in the GBA, said Ren Zhihong, the director of Institute of Finance of Guangdong Academy of Social Sciences and the director of Hong Kong, Macao and Taiwan Research Center. New technologies and related appliances will optimize resource allocation of the financial industry. The merging of finance, innovation and industry, not to mention the capital chain, will greatly promote the efficiency and lower the risk of financial transactions, providing a healthy business environment for the GBA and enhancing its competitiveness.
Authors: Will, Zoey (intern)