US should allow China to enter its banking area!

US should allow China to enter its banking area!
Sep 25, 2007 21:55
DREAMLIFE Points: Join Date: Sep 5, 2007 Status: offline	According to the news, the chairman of CBRC (China Banking Regulatory Commission) said in an interview that if Chinese banks could get the licenses to operate in US, China will allow international investor to take more stakes in domestic banks in China. What's more, he said that bilateral cooperation is very important if China is required to expand the open door and market entry policies. Meanwhile, US should not delay or refuse Chinese banks' applications to open their branches in US. This is no good. Here Chinese banks refer to ICBC (Industrial and Commercial Bank of China) and CMB (China Merchants Bank). Both have submitted their applications to open their branches in New York. However, they have not got their licenses. According to the reoprt of CBRC, about 74 foreign banks from 22 countries had set up their branches or institutions in 25 cities in China by the end of 2006. 186 foreign banks have established 242 represntative offices in China. Among them, the number of the branches of US banks ranks the second place following Hong Kong. In addition, Chinese commercial banks had attracted 29 overseas investors or foreign institutions by the end of 2006. The investment volume reached 19 billion US dollars. There are six investors or institutions that come from US, ranking the first place. However, US continues to require China to broaden its market entry policies. Personally, I think that US should open its banking area to China equally. They should not require China to open its financial market unilaterally. It is unfair. Why is US reluctant to open its banking area to China? Because they are concerned about the transparency and management of Chinese banks. What's more, they think that Chinese banks are absent of a leagal framework to combat the anti-laundering black money. However, this should not be an excuse to refuse Chinese banks to enter its banking area. What do you think? Should US allow Chinese banks to enter its banking area?

Sep 25, 2007 21:55

DREAMLIFE
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According to the news, the chairman of CBRC (China Banking Regulatory Commission) said in an interview that if Chinese banks could get the licenses to operate in US, China will allow international investor to take more stakes in domestic banks in China.

What's more, he said that bilateral cooperation is very important if China is required to expand the open door and market entry policies. Meanwhile, US should not delay or refuse Chinese banks' applications to open their branches in US. This is no good. Here Chinese banks refer to ICBC (Industrial and Commercial Bank of China) and CMB (China Merchants Bank). Both have submitted their applications to open their branches in New York. However, they have not got their licenses.

According to the reoprt of CBRC, about 74 foreign banks from 22 countries had set up their branches or institutions in 25 cities in China by the end of 2006. 186 foreign banks have established 242 represntative offices in China. Among them, the number of the branches of US banks ranks the second place following Hong Kong. In addition, Chinese commercial banks had attracted 29 overseas investors or foreign institutions by the end of 2006. The investment volume reached 19 billion US dollars. There are six investors or institutions that come from US, ranking the first place. However, US continues to require China to broaden its market entry policies.

Personally, I think that US should open its banking area to China equally. They should not require China to open its financial market unilaterally. It is unfair. Why is US reluctant to open its banking area to China? Because they are concerned about the transparency and management of Chinese banks. What's more, they think that Chinese banks are absent of a leagal framework to combat the anti-laundering black money. However, this should not be an excuse to refuse Chinese banks to enter its banking area.

What do you think? Should US allow Chinese banks to enter its banking area?

Sep 26, 2007 17:24

ERENCIUS
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Quote:
"Because they are concerned about the transparency and management of Chinese banks. What's more, they think that Chinese banks are absent of a leagal framework to combat the anti-laundering black money. However, this should not be an excuse to refuse Chinese banks to enter its banking area."
I think these are excellent excuses actually though I don't think it is the main reason.
French banks also had some problem to enter the US market. Let's say they love competition outside their borders (lowering prices) but they are quite protectionist once you enter the national market (potential risk). But this is true only for foreign companies, between American ones usually competition is quite effective and free.

Sep 27, 2007 03:33

JIMMYB
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Let's say they love competition outside their borders (lowering prices) but they are quite protectionist once you enter the national market (potential risk).

You are quite right, ERENCIUS. Why do they ask China to open its financial market? Because they want make money. Compared with Chinese domestic banks, they have obvious advantages. It is easy for them to win in the competition. However, when Chinese banks applied to enter its market, they have many excuses. To some extent, they are afraid that those Chinese banks might harm their domestic banks. They are really smart.

Sep 27, 2007 05:50

ERENCIUS
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Quote:
"They are really smart."

I dont think it is linked to being smart or not, it is just logic and continuity. They always obliged every single country to let its boundaries wide open to international competition, especially the "third world" countries, insuring them that they ll be the winning part doing so, but actually many countries lost everything because of this absolute opening. As they hold 90% of the UN and a good part of the WTO, this treatment shall not be applied to them.
China survived well to it and took advantge of its low labor costs but more interesting is still to come I guess.

But frankly, Chinese banks have to work on their transparency, and not only banks. We shall not open to any market to any company in any country whose management is untrustworthy. This is my opinion.

Oct 4, 2007 22:47

JIMMYB
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But frankly, Chinese banks have to work on their transparency, and not only banks. We shall not open to any market to any company in any country whose management is untrustworthy.

Yes, ERENCIUS. At present, those state owned banks have started their reform plan. The ICBC (Industrial and Commercial Bank) and CCB (China Construction Bank) have gone public. I remember that Paul once said that it means that those state owned banks were sold to the individuals or corporations to make profits. But the common peolple lost out by that amount. What do you think of it?

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