People’s Daily reported that, at a recent State Council Information Office press conference, China’s central bank, The People’s Bank of China, stated that the Bank supports Shanghai in taking the lead on exploring a way to the free use of the Chinese Currency RMB, under the condition that the use should comply with regulations on anti-money laundering, anti-terrorist financing, and anti-tax evasion. This is to facilitate the flow of funds supporting trade investments. It is also to explore the free currency exchange mechanism for capital moving in and out of the Lingang New Area of the Shanghai Pilot Free Trade Zone. The new policy also helps Shanghai become an important hub and bridge the connection between the international and domestic markets under Shanghai’s new development framework. Not long ago, China’s State Council released a Guidance on supporting “Shanghai Pudong’s high-level reform and opening-up to create a leading area for socialist modernization.” The Guidance allows the expansion of financial openness, aimed at establishing an offshore financial system that matches Shanghai’s international financial center status, and at improving offshore RMB transaction volume with risk management.
Source: People’s Daily, July 20, 2021