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Chinese Banks Urged to Prepare for Post-WTO Competition
Liu Mingkang, chairman and president of the Bank of China, said Thursday Chinese banks should prepare themselves for tougher competition from its foreign counterparts after China joins the World Trade Organization (WTO).
Liu said at a Fortune Global Forum roundtable that China's banking sector will not only enjoy advantages brought about by China's WTO accession, but also face many new challenges.
In five to 10 years, Chinese banks may be faced with problems, such as the loss of clients and brain drain, as a result of foreign banks' flooding into China, he said.
However, Liu was also optimistic about the post-WTO scenario since Chinese banks would also benefit in many aspects.
Giving an example, Liu said that in terms of taxation policies, Chinese banks would receive the same treatment as their foreign peers once China joins the WTO.
The government will also improve the transparency of its financial policy after the country joins the WTO, which is also beneficial for Chinese banks, Liu added.
In post-WTO China, domestic banks will strengthen cooperation with foreign banks, he said, adding that foreign banks will also use home banks' operation network and the latter will learn the advanced management expertise from the latter so that they can complement each other.
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