世界经济论坛-从沙箱到桥梁：大湾区在连接中国与全球资产管理中的作用（英）-2021.9-34页_6mb

Summary of "From Sandbox to Bridge: The Role of the Greater Bay Area in Connecting China with Global Asset Management"

Core Content

This document explores the role of the Greater Bay Area (GBA) in transforming China's asset management industry and enhancing its integration with global financial systems. It outlines the drivers of transformation, the unique positioning of the GBA, and the opportunities for China Asset Management 3.0, emphasizing the potential for cross-border innovation and growth.

Main Drivers of Transformation

1. Pension Reform

   • China's aging population is driving demand for pension solutions.
   • New commercial pension pilots have been launched in 2021 in Beijing, Chongqing, and Zhejiang.
   • A variety of professional asset management entities (e.g., fund management companies, wealth management subsidiaries) are expanding retail offerings.
   • Increased customer education by financial institutions is critical for retirement planning and pension allocation.

2. Policy and Regulatory Development

   • Regulatory reform is a key priority under the 14th Five-Year Plan, aiming to establish a globally competitive financial system.
   • New asset management rules have led to the reduction of shadow banking and the shift to NAV-based AUMs.
   • The GBA is expected to lead in testing innovative regulatory frameworks and facilitating cross-border financial integration.

3. Competitive Financial Institutions

   • The goal is to develop a modern, competitive, and inclusive financial system.
   • Strengthening corporate governance and deepening financial institution reforms are central to this effort.

4. Mature and Resilient Capital Markets

   • The focus is on establishing a multi-layered capital market, improving professionalism, and enhancing investor protection.
   • The GBA is seen as a testing ground for new financial instruments and regulatory experiments.

5. Comprehensive Regulatory Framework

   • The GBA is expected to complement China's modern financial regulatory system and align with global standards.
   • Emphasis on risk control, transparency, and cautious innovation is key to regulatory success.

6. Fintech Innovation

   • The asset management industry has seen rapid technological development.
   • AI-led advisory services are enabling a more customer-centric model, focusing on personalization and long-term investing.
   • Over 15 players are offering digital fund advisory services, with more than 30 expected to receive licenses.

The GBA: Uniquely Positioned to Accelerate Growth

Economic Development

• The GBA's GDP is expected to double to $4.6 trillion by 2030, surpassing the combined GDP of the San Francisco and New York Bay areas.
• It is a key pillar of China's growth ambitions, with a strong mix of manufacturing and financial hubs.

Financial Reform and Innovation

• The GBA is positioned as a centre of excellence for financial reform and innovation, leveraging its 11 cities to create a comprehensive ecosystem.
• Hong Kong serves as the main platform for global connectivity, while Shenzhen is a global innovation hub.
• The region has the potential to accelerate themes such as cross-border trade, green finance, and central bank digital currency (CBDC).

Key Cities

• Core Cities:

  • Hong Kong: International financial centre, largest offshore RMB hub, and Asia-Pacific dispute resolution hub.
  • Macau: Tourism and cultural hub, with strong Portuguese cultural ties.
  • Guangzhou: Comprehensive gateway city, green finance pilot zone, and major transportation hub.
  • Shenzhen: High-tech powerhouse, fintech pilot zone, and national digital RMB pilot zone.

• Node Cities:

  • Zhuhai: Core Pearl River Delta city, integrated with Macau.
  • Jiangmen: Western hub city, with strong industrial and trade foundations.
  • Dongguan: Advanced "world factory", export-oriented manufacturing hub.
  • Zhongshan: Youth innovation platform, developing advanced manufacturing and IT.
  • Foshan: Manufacturing and trade hub, with offshore trade cooperation with Hong Kong.
  • Zhaoqing: Emerging southwest city, rich in land and natural resources.
  • Huizhou: Energy and manufacturing hub, with a strong base in home appliance production.

China Asset Management 3.0: Enabling "Made in GBA"

Key Characteristics

• The GBA is expected to lead the third phase of growth in China's asset management industry.
• This phase emphasizes global interoperability, product innovation, and regulatory testing.

Market Trends

• AUM is shifting towards professional asset managers and quasi managers.
• Professional managers (e.g., private funds, mutual funds) are growing at a faster rate than quasi managers.
• The GBA is a testing ground for new policies, products, and services, which could later be adopted nationally.

Investor Demand

• The GBA is home to 20% of China's ultra-high-net-worth (UHNW) and high-net-worth (HNW) households.
• 70% of UHNW and HNW individuals in the GBA have a strong interest in cross-border investments.
• There is a clear appetite for foreign financial products, especially as they become more accessible.

Survey Insights

• Investor Profile:

  • 80% of respondents are under 40 years of age.
  • Almost 90% have existing stock investment experience but are unfamiliar with foreign financial products.
  • Over 80% have not previously invested in foreign financial products.

• Investment Objectives:

  • Risk diversification is the primary goal, ahead of enhanced returns.
  • Overseas investments are expected to be long-term in nature.

• Product Preferences:

  • 60% of investors show strong interest in mutual fund products for overseas investment.
  • 60% prefer onshore products (which invest overseas) over offshore products, except for high-income individuals.

• Investment Behaviors:

  • Before investing: investors seek information and product details.
  • Upon investing: traditional financial institutions are preferred for transaction facilitation.
  • After investing: post-investment services (e.g., risk alerts, portfolio analysis) are highly valued.

The GBA as a Shaper of the Future of Chinese Asset Management

• The GBA is expected to facilitate two-way access to global markets via Hong Kong.
• It aims to become a regional asset management centre, leveraging its financial infrastructure and regulatory flexibility.
• Sustainability is a key focus, with the GBA playing a pivotal role in shaping the future of ESG investing and green finance.

Conclusion

The GBA is a strategic hub for China's asset management industry, poised to accelerate growth and enhance global integration. Its unique combination of economic development, financial innovation, and regulatory experimentation positions it as a bridge to global markets, enabling the transition from a sandbox to a more mature, integrated system. The professionalization of the asset management industry, along with fintech innovation and cross-border investment opportunities, will be key to unlocking the full potential of the GBA as a driver of financial transformation in China.