Broader Investment Choices for Insurance Companies
November 30, 2006 | BY
clpstaff &clp articlesWill the Circular on the Investment in the Equity Interests of Commercial Banks by Insurance Institutionsdiminish benefits for foreign investors? How will local insurers manage the new dimension of competition?
The insurance industry in China is growing at a remarkably fast pace. By the end of 2006, this industry will allow foreign insurers to compete with local insurers. To guide this new process, the China Insurance Regulatory Commission has issued the Circular on the Investment in the Equity Interests of Commercial Banks by Insurance Institutions. Will the rules in this Circular diminish benefits for foreign investors? How will local insurers manage the new dimension of competition?
By Tom Vinaimont, Department of Economics & Finance, City University of Hong Kong
China's entry to the World Trade Organization (WTO) affects the Chinese economy on many levels. The fast-growing insurance industry is one whose entry into the WTO will allow international entrants to compete with local insurers. In response, the China Insurance Regulatory Commission (CIRC) has introduced new regulations in preparation for the opening of the insurance market to foreign investors.
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