Germany pushes China to open its financial sector

Germany pushes China to open its financial sector
FILE PHOTO: German Finance Minister Olaf Scholz attends a media briefing during his visit to Beijing, China, January 17, 2019. REUTERS/Thomas Peter/File Photo Copyright Thomas Peter(Reuters)
By Reuters
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By Michael Nienaber

BEIJING (Reuters) – Germany and China are working on ways to improve market access for each other’s banks and insurers, the German finance minister said on Thursday, and he welcomed plans by China and the United States to ease trade tensions through talks.

Germany and China both want to signal that the world remains multilateral and that all countries are trying to cooperate, said Olaf Scholz, who is on a two-day visit to Beijing.

The two countries are expected to sign agreements on Friday to expand cooperation in financial services. The agreements are part of Scholz’s effort to convince China that opening its economy is in its own interest.

“This is especially important for the financial sector,” Scholz told reporters, adding that the talks in Beijing were aimed at improving market access for German banks and insurers in China and the other way around.

“This will lead to more wealth on both sides,” Scholz said.

Scholz will meet Chinese Vice Premier Liu He on Friday. Both are expected to attend a ceremony where Germany’s financial- market regulator, Bafin, will sign two agreements with Chinese authorities, a German government official said.

The first agreement is with the China Banking and Insurance Regulatory Commission and the second with China’s Securities Regulatory Commission, the official said. A third agreement may be concluded between China and Germany’s Bundesbank, he said.

Scholz is also campaigning for Germany to become a hub for Chinese and renminbi-denominated financial products in Europe, after Britain’s exit from the European Union.

During a panel discussion at a university in Beijing, Scholz urged China to share more information about its lending in other countries to increase debt transparency. China has become one of the largest lenders in emerging markets, but it is not a member of the Paris Club of government creditors.

Turning to the trade dispute between China and the United States, Scholz said that the latest round of talks was a good sign and he hoped that the negotiations were successful.

“It is good that patience is paying off and that there are signs that there are further talks between China and the United States,” Scholz said.

Liu will visit the United States on Jan. 30 and 31 for the next round of trade negotiations with Washington, China’s commerce ministry said on Thursday.

(Reporting by Michael Nienaber; writing by Thomas Seythal; editing by Riham Alkousaa, Larry King)

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