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OpinionWorld Opinion
Andrew Sheng
Opinion
Andrew Sheng

China needs high-quality financial development to support its five-year goals

Inclusive and green finance that is risk-resilient and supportive of innovation and technology must be the foundation of the new Chinese development model

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People enjoy themself on the Bund near the financial district of Pudong, in Shanghai, China, on September 27, 2024. Photo: Reuters
Andrew Sheng
Andrew Sheng is a former central banker and financial regulator, currently distinguished fellow at the Asia Global Institute, University of Hong Kong.
President Xi Jinping’s speech at the fourth plenum of the Communist Party’s Central Committee last month outlined the guidelines for the upcoming 15th five-year plan. There is clearly determination to focus on technological self-reliance, building an economic model of high-quality productive forces based on innovation and a strong industrial base that is resilient against external threats and headwinds.
At the Financial Street Forum in Beijing at the end of October, Vice-Premier He Lifeng stressed the need for China’s financial system to advance risk prevention, strengthen regulation and promote high-quality development. Since the 15th five-year plan time frame will be a key period for achieving socialist modernisation by 2035, a high-quality productive real economy model will require high-quality financial development, demanding an equally strong financial sector. The announcement that China would continue to open up its financial sector to foreign participation has been warmly welcomed.

During the forum, the country’s top financial leaders – including People’s Bank governor Pan Gongsheng, National Financial Regulatory Administration head Li Yunze and China Securities Regulatory Commission chairman Wu Qing – outlined measures to improve macroprudential regulation and make the financial system more inclusive and supportive of high-quality growth. They also emphasised appropriate risk management and financial stability.

The plenum communique clearly set out the guiding principles for the 15th five-year plan. The Communist Party is in charge of leading and implementation, pursuing high-quality development, comprehensively deepening reform and ensuring both development and security. The five-year plan will need to deliver a wide range of significant achievements in the country’s development.

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