China has just opened its financial system removing foreign ownership limits on banks and allowing foreign firms to take majority stakes in joint ventures, insurers etc.
"It's a key message that China continues to open up and make its financial markets more international and market-oriented," said Shen Jianguang, chief Asia economist at Mizuho Securities Asia Ltd. in Hong Kong. "How important a role foreign financial firms can play remains to be seen."
Even if they take full control of their China ventures, international financial companies will face multiple challenges. One of the biggest is competition from government-controlled rivals, who currently dominate the nation's financial system and have longstanding relationships with giant state-owned companies that drive much of China's economic activity.
Thoughts on this monkeys? Now that international banks won't be marginal players anymore in China, what could change both there and worldwide?