Market Access Report: The Banking Sector

December 31, 2001 | BY

clpstaff &clp articles

China's accession to the World Trade Organization is expected to create new opportunities for foreign banks. By June 2001, 190 foreign invested banks had…

China's accession to the World Trade Organization is expected to create new opportunities for foreign banks. By June 2001, 190 foreign invested banks had a presence in China, including branches, sub-branches and joint ventures. However, their market share remains very small, at less than 2%. Many foreign bankers attribute this to China's restrictive regulations.

China is expected to loosen these restrictions after WTO accession. First, China will eliminate or gradually phase out geographic and clientele restrictions on foreign banks. This is likely to enhance foreign banks' ability to offer products and services to customers throughout China. Second, China will gradually remove most of the branching and licensing restrictions on foreign banks. The question now on everyone's mind is how foreign banks should seize these post-WTO opportunities.

WTO Commitments

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