Financial Services Talking Points | 11-11-2016

In today’s talking points: Singles Day 2016: Alibaba in the Spotlight; Big Plans for Free Trade Zone (FTZs) Replication Across China; China’s finance industry to undergo transformation; UK and China look towards deepening financial ties

Singles Day 2016: Alibaba in the Spotlight
Friday November 11th 2016: another ‘Singles Day’ has dawned at last. Launched by China’s e-commerce giant Alibaba Group Holding, that has recently opened a number of offices in Australia, ‘Singles Day’ is expected to continue the upwards trend, trumping the sale figures of last year’s event.
The initial figures do not disappoint, as this morning saw Alibaba Group post $US1 billion ($1.3 billion) of sales within the first five minutes of its Singles’ Day shopathon, a 24-hour event that may offer clues on the health of the Chinese economy and its largest online retailer. Of course due to the recent post-election fluctuations in Alibaba’s US-traded shares, and reports of China’s slowing economy investors are keeping an especially close eye on the developments to see whether the speculations of another triumphant success prove to hold out.
Big Plans for Free Trade Zone (FTZs) Replication Across China 
Inspired by the successes of the established FTZs, the Chinese government is seeking to replicate the experiment by establishing a number of new zones nationwide. The State Council has published a circular mapping out the replication, which will see 19 new items applied across the country.
Among the successes of the FTZs has been the introduction of a negative list, which specifies investment sectors off-limits to foreign investors and allows industries not on the list to follow the same new investment rules as domestic firms. Furthermore, FTZs are a great way of testing new policies, including interest rate liberalization and fewer investment restrictions, to better integrate the economy with international practices. Another seven Free Trade Zones were added across the country in August this year.
The expansion comes more than three years after the launch of China’s first FTZ in Shanghai, and follows the wave of expansion in late 2014, when Tianjin, Fujian and Guangdong were allowed to set up the second group of FTZs.

Read more at China Daily

China’s finance industry to undergo transformation
Mergers and acquisitions have accelerated the rate of transformation of China’s finance industry. Vice chairman and president of China Investment Corporation said “The expansion from trade finance to acquisition finance will provide a strategic opportunity for development of the Chinese financial sector”. In the first half of this year, the volume of cross border mergers and acquisitions led by Chinese buyers exceeded the total volume in 2015. According to the chairman of Bank of China, that amount accounted for 23 percent of the total volume of global cross-border mergers and acquisitions. 
Read more at China Daily
 UK and China look towards deepening financial ties 
Britain and China’s top finance officials announced the two countries would look at closer cooperation between the stock exchanges and other initiatives in the financial services sector to deepen ties. The British finance minister and Chinese Vice Premier met as part of efforts to increase ties between the world’s second and fifth largest economies. Britain’s finance minister announced several financial initiatives such as opening Chinese financial firms’ offices in London, and promised relaxation of rules to allow British firms to own larger stakes in parts of China’s finance sector. 
Read more at Reuters