Revolution of the financial market is bringing us new opportunities from internet-based financials to new derivatives. Where would the “blue ocean” developed by the Shanghai international financial centre be? And during the course of such development, how shall we tap on the dynamic private enterprises to establish a financial ecosystem with economic diversity?

On 2 June, The Bund Global Financial Summit was held at Waldorf Astoria Shanghai on the Bund. Huang Mengfu, Honorary Chairman of All-China Federation of Industry and Commerce, and Tu Guangshao, Standing Committee Member of the CPC Shanghai Municipal Committee and Executive Vice Mayor of Shanghai, attended and delivered speeches. Reputable entrepreneurs, financiers and scholars were invited to gather in Shanghai and provide advice on the development of Shanghai financial ecosystem and develop strategies for the Shanghai Financial Centre from the perspective of private sectors. These include Jack Ma, Ma Weihua, Wang Zimu, Zhang Liping, Feng Lun, Cai Hongping, Yu Liping and Zhang Weiying, to name just a few, as invited by Wang Shi, Rotating President of Yabuli China Entrepreneurs Forum; Chen Dongsheng, Board Chairman of Yabuli China Entrepreneurs Forum; Tian Yuan, Chairman of Yabuli China Entrepreneurs Forum; Niu Ximing, Board Chairman of Shanghai Financial Association and Chairman of Bank of Communications; and Guo Guangchang, Council Member of Yabuli China Entrepreneurs Forum and Chairman of Fosun Group. 

The summit was organized by Yabuli China Entrepreneurs Forum and Shanghai Financial Association, jointly-organized by Fosun Group and co-organized by The Bund Financial Center‧BFC.  Positioned as the first “International Metropolitan Meeting Hub” in the Bund’s financial district cluster, BFC will be completed in 2015. A BFC twin tower, 180 meters of height, will become the future landmark of the Bund and act as a world class platform for fulfilling China's aspiration in the financial world.

Attendees of the summit include Zhou Wei, Secretary of the Party Committee of Huangpu District in Shanghai; Peng Song, Chief Executive of Huangpu District; Liang Xinjun, Vice Chairman and CEO of Fosun Group; and Wang Qunbin, Executive Director and President of Fosun Group.

Wang Shi: Financial market should open up to different types of capital

As the one on duty of Yabuli China Entrepreneurs Forum, I would like to thank the Shanghai Municipal Government and Party Committee and District Government of Huangpu District for their support towards our event. In particular, I would like to thank Mr. Guo Guangchang of Fosun Group for his facilitation and organization of this summit. It is of time significance to select the Bund for hosting the summit, which is the first financial expertise forum ever held by Yabuli China Entrepreneurs Forum.

Back to the 1930’s, the Bund was once known as the Wall Street of the Far East, with a sizable financial market just ranking next to London and New York. As a national strategy, the international financial centre will be rebuilt in Lujiazui and the Bund. I arrived Shanghai last night. When I went to the Bund, I noticed a glittering “Bund Bull” at Bund Financial Square. This reminded me of the Charging Bull outside the stock exchange building in Wall Street.  Both the Charging Bull in Wall Street and the Bund Bull in Shanghai were created by the same sculptor to demonstrate a rediscovering towards fortune and the market.

Private enterprises are gradually growing amid the opening up of economy and diversification of market competition, and are becoming the most dynamic and innovative components in the Chinese economy. The position of Shanghai international financial centre is all about a fair, transparent and competitive ecosystem to allow private capitals to enter the capital market. Their relationship is based on fair competition. A sufficiently open financial market which assure fair competition for state, foreign and private enterprises shall provide the financial sector as well as the entire economy sustainable and intense vitality. The Summit seeks to discuss financial issues from market perspectives. It encourages fair conversation among private enterprises and provides a platform for their engagement in development of a financial ecosystem in Shanghai. 

Guo Guangchang: the reason I am taking the role of attendant today

Just as Wang Shi claimed that he is the one on duty, I , as the jointly-organizer, am actually the one who is arranging the tables, serving tea and greeting you all at the entrance. As an attendant to serve you, my task is to raise some issues which I believe would be meaningful in respect of the Chinese economy today.

First of all, as Mayor Tu is here, he might tell you the differences between the financial strategies between Shanghai and that of New York and Beijing. This is critical for us as Shanghai enterprises seeking for development here. Jack Ma is also invited here. Just as what he always says –the era has changed. This era in financial sector has also changed. So what opportunities and challenges are we offered?

Secondly, both Niu Ximing and Ma Weihua are present. A question is disturbing me. Why are banks gaining away so much money?  Out of the 2,000 or so listing companies, half of the earnings are taken away by 11 banks. If this keeps going, what shall we manufacturers do? Given the high earnings in banking industry, everybody starts concerning the interest rate liberalization for capital. Recently, we also concern about insurance companies. What does it mean to insurance companies by interest rate liberalization in insurance? We have invited He Zhiguang, President of New China Life Insurance, and Wang Zimu, Chairman of Huatai Insurance. Please give us some advice.

Thirdly, of course, is my most concerned issues. 20 years ago, we had Minsheng Bank and Taikang Insurance. Private enterprise can do well in financial sector. They provided us a good start. However, my question is: why are they the only few companies after so many years of pilot programs? Can we have a few more such companies? I have also a number of questions regarding IPO, shadow banking, government debt as well as appreciation of Renminbi and more. I hope fellow guests may provide us some insights.

Jack Ma: Finance Industry needs a “troublemaker”

The financial ecosystem must firstly open up. I personally believe that this is inadequately regulated in USA, and overregulated in China. Overregulation will make our financial ecosystem become a farm – we get whatever we grow, and never have whatever we do not grow. However, a real ecosystem must be open to allow diversity and public engagement.

For the development of Chinese economy, I believe if we work on servicing those 80% underserviced but deserved to be serviced, the enormous potential of China shall be brought to play. I think this might mean the bright outlook of the future financial sector of China. What we could not do become possible today. Internet finance provides us such opportunity. Firstly, we have financial network, that is to allow the finance industry connecting by internet. Secondly, we have internet finance, which is purely an outsider. In particular, many industries depend on such outsiders for innovation. Finance industry also needs a “troublemaker” and more of such outsiders for a reform.

“Open up” is primarily about our minds instead on policies. Only open minds can fulfill open technology and policies. Therefore, it is the belief of every player in financial sector to engage and develop the future of our country together.

The financial sector is indeed doing well today. Without the financial institutions which support 20% of the customers, the Chinese economy could not have developed to what we are today in the past 3 decades. However, I do not think that the current mechanism is able to support the financial system that China needs after 3 more decades. That is what we need to consider today. 

Chen Dongsheng: The era of the emergence of a financier community has come

I believe the era of Chinese finance has come. The era of the emergence of a financier community has come.

In the past 3 decades, the China economy has undergone industrialization and urbanization, and its economic structure has become service oriented. There is based on one more important fact. The rise of the middle class indicates the era of consumption has come. One must understand that the beginning of the consumption era means the starting of wealth management for the entire nation, which in turn means an innovation, or expansion or huge development, in the finance industry. This is the main background of where we are.

There is one more important judgment regarding finance industry of China in general. In this 3 decades, China formed a basic financial framework with reference to the western world, that is our “one bank and three committees” regulatory system. Our market system, banking, securities and insurance systems, as well as sectors like PE, public offering fund, social security fund, as well as supplementary pension, are all under rapid development. Subsequently, we have important boosters and regulators for financial ecosystem, such as ratings, accounting firms, law firms, as well as financial media and financial commentators. Therefore, in every aspect from media, intermediaries, in addition to the newly formed social security fund, public offering fund, supplementary pension, PE, to banking, securities and insurance, China has developed enterprises of their brand during these years of development. That is why I often say – the Chinese brand as a whole and the framework for the entire system have basically formed.

In short, we have laid a good foundation for a huge development of Chinese economy and financial sectors. Systems required for financial development is basically ready. Given the current position of our economy, we should take interest rate liberalization and reform of entrepreneurship, the core of the industry, as a prerequisite. Therefore, I highly recommend and support The Bund Global Financial Summit. Yabuli and we, Huangpu District of Shanghai, shall sustainably make this entrepreneur forum to become our civilian finance forum. I wish for success in this summit. I hope we can continue striving in the future with this summit as a start.