China’s financial markets- a future global force?
China Financial Market
As the world struggles with the financial crisis and its repercussions on the global economy, questions inevitably arise as to what and who will drive the financial markets in future years. China is likely to be one of the key players, given its dynamic development.
China’s financial markets have enjoyed a period of strong growth since the early 1990s, even though they are still relatively small compared to those of industrial countries and some other emerging markets.
Regulatory bodies have followed a careful and gradual reform path and will most probably continue with this approach. Given the current turmoil in global financial markets and the experience of successful gradual reforms, this approach is likely to provide a good basis for sustainable development in the future.
It would be unrealistic to expect China to emerge unscathed from the global recession. The weaknesses of less financially sound banks will be exposed during the downturn. A strengthening of provisioning and the capital base will be needed in light of a potential rise in credit losses.
