Country Profiles



Official name : People's Republic of China

Government : One-party rule by the Chinese Communist party (CCP)

Head of State : A president, currently President Xi Jinping (since 14 March 20013)

Capital City : Beijing

Main towns : Chongqing , Tianjin , Shanghai , Shijiazhuang , Beijing , Wuhan , Chengdu , Qingdao , Harbin , Guangzhou ,

Land area : 9,561,000 sq. km

Population : 1.393 bn (2018 est.)

Climate : Continental, with extremes of temperature; subtropical in the south-east

Currency : 1 yuan/renminbi (y/Rmb)=10 jiao=100 fen (ISO currency code: CNY)

Exchange rate : USD 1 = CNY 6.92 (August 2020)

Measures : The metric system is used alongside certain standard Chinese weights and measures

Language : Mainly Putonghua, based on northern Chinese (the Beijing dialect known as Mandarin); also local dialects and languages.

Time : Zone I (Urumqi) six hours ahead of GMT; zones II, III and IV (Chongqing, Lanzhou, Beijing, Shanghai, Harbin) eight hours ahead of GMT; nine hours ahead of GMT during Beijing summer time, mid- April to mid- October.

Regulatory Scheme

Four main bodies regulate the Chinese financial industry. They are the People's Bank of China (PBC) which acts as the central bank of China, the China Banking Regulatory Commission (CBRC), the China Insurance Regulatory Commission (CIRC), and the China Securities Regulatory Commission (CSRC). All four bodies operate under the State Council. The Ministry of Finance (MOF) also promulgates regulation. China's economy has grown at a quick pace since its recent accession into the WTO in 2001, however the Chinese economy continues to be highly regulated. The banking and insurance sectors are still developing but there has been good progress made. Other areas of the economy have been slower to develop. Similarly, the Chinese legal system continues to have problems of enforcement and credibility. Although the Chinese government has made strides to move the country towards a market economy there is still a long way to go and some question whether the CCP is truly committed to this goal.


The banking system comprises four large state-owned commercial banks (SCBs), three policy banks, ten national joint-stock commercial banks, around 90 municipal commercial banks, and about 3,000 urban and 42,000 rural credit co-operatives. About 160 foreign banks have branches or representative offices in China, but their activities are highly restricted. In terms of both lending and deposits the four SCBs (the Bank of China, the Agricultural Bank of China, the Industrial and Commercial Bank of China and the China Construction Bank) hold an overwhelming share of the market. The four SCBs also control the branch networks and employees. Four asset management companies (AMCs) were set up in 1999, charged with acquiring and disposing of the non-performing loans of the four state-owned commercial banks. There also continues to be strict regulations controlling the exchange of foreign capital and RMB. Most transactions must be cleared through the State Administration of Foreign Exchange (SAFE).

Stock Exchange

China's two stock exchanges are based in Shanghai and Shenzhen. These markets trade equities and bonds. About 800 large SOEs have listed stock on the markets and are known as joint-shareholding companies. The Chinese equity markets have been extremely volatile in recent years, and continue to have problems with liquidity and transparency. The China Securities Regulatory Commission has authority over stock trading, and the China Insurance Regulatory Commission supervises insurance companies and their use of the capital markets. There are two categories of shares. "A" shares, denominated in renminbi, are open only to Chinese investors and "B" shares, also denominated in renminbi, but traded in US dollars in Shanghai and in Hong Kong dollars in Shenzhen. Several Chinese stocks are listed in New York, London and Hong Kong. Many of the shares on the stockmarkets are state-owned and not tradable.


The Chinese insurance industry is highly regulated and concentrated. Liberalization of the market began in 2001 in selected Chinese cities. There are still some questions as to how effectively these WTO commitments have been carried out and how much market access foreign insurers are actually allowed. The China Insurance Regulatory Commission (CIRC) is the primary regulator of the Chinese insurance sector. New insurers must have registered capital of not less than CNY200 million and senior management personnel with the necessary professional knowledge for their positions and with working experience in the business. Also the place of business and other business-related facilities must be adequate. New insurers must have more than 30 years of experience in the insurance business and total assets of more than USD5 billion at the end of the year prior to application. There must also be a representative office established in China for more than 2 years. Foreign insurers who wish to enter the market must be organized as either a branch, a sino-foreign equity joint venture or a wholly-owned subsidiary. Non-life insurers are allowed to set up operation in China as branches or subsidiaries while life insurers must form joint ventures. A branch office is permitted to open sub-branches only in the region where it is registered, however a subsidiary can open a branch office nationwide with an additional CNY20 million. Solvency margins are calculated using a complex formula and depending on what type of business is being done. Insurers have strict investment limitations. There are around 11 domestic non-life insurance companies and 11 foreign branches. The major foreign non-life players include AIU, Ming An, Tokyo Marine & Fire, Winterthur, RSA, Federal, Mitsui Sumitomo, Samsung Fire & Marine, Zurich, BOC, Allianz, Sompo, GAN and Liberty Mutual. Only 4 of the 11 domestic companies are authorized as national insurers who can conduct business on a nation-wide basis and the rest are regional players. All foreign branches are confined to Shanghai, Guangzhou, Shenzhen and Foshan, Haikou, Dalian, Chengdu and Chongqing. Motor (62.1%), fire (16.6%) and cargo (4.7%) are the primary lines of non-life business. There are around 7 domestic life insurance companies, one foreign branch and 16 sino-foreign joint ventures in operation. 6 of the 7 domestic companies (except China United) are authorized as national insurers who can conduct business on a nation-wide basis. All operating foreign branches and joint ventures are currently confined to Shanghai, Beijing, Guangzhou, Shenzhen and Dialian (except for AIA which operates also in Foshan, Suzhou, Dongguan and Jiangmen). The share of top 3 companies is roughly 85% in terms of premium income. The total foreign share is around 2% on a national basis.

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