Footnotes

Chapter 1 - The context for the delegation's discussions

[1]        Mr Mike Smith OBE, Chief Executive Office, ANZ Banking Group, 'Seizing Asian opportunity up to us', Weekend Australian, 13 April 2013, p. 31.

[2]        Dr Philip Lowe, Deputy Governor of the Reserve Bank of Australia, The Journey of Financial Reform, Address to the Australian Chamber of Commerce in Shanghai, Shanghai, 24 April 2013. http://www.rba.gov.au/speeches/2013/sp-dg-240413.html (accessed 17 May 2013).

[3]        See 'China's 12^th Five Year Plan: How it actually works and what's in store for the next five years', APCO Worldwide, 10 December 2012, http://apcoworldwide.com/content/PDFs/Chinas_12th_Five-Year_Plan.pdf (accessed 17 May 2013).

[4]        See the comments of Mr Mike Smith OBE, 'Seizing Asian opportunity up to us', Weekend Australian, 13 April 2013, p. 31.

[5]        China's 12^th Five Year Plan, Chapter 48, http://www.cbichina.org.cn/cbichina/upload/fckeditor/Full%20Translation%20of%20the%2012th%20Five-Year%20Plan.pdf (accessed 17 May 2013).

[6]        The capital account consists mainly of foreign direct investment, investment in equities and bank borrowing. Liberalising the capital account would enable foreigners to more readily invest in China's assets.

[7]        The benchmark rate is set by the PBOC.

[8]        See Takeshi Jingu, 'China resumes interest rate liberalization', Nomura Research Institute, 2012, volume 148.

[9]        Dr Philip Lowe, Deputy Governor of the Reserve Bank of Australia, The Journey of Financial Reform, Address to the Australian Chamber of Commerce in Shanghai, Shanghai, 24 April 2013.

[10]      President Xi commenced office on 14 March 2013, while Premier Li commenced as Premier the following day. 

[11]      The Hon. Julia Gillard MP, Prime Minister of Australia, 'Prime Minister and Senior Ministers to visit China', Media Release, 31 March 2013, http://www.pm.gov.au/press-office/prime-minister-and-senior-minister-visit-china (accessed 24 June 2013).

[12]      Dr Philip Lowe, Deputy Governor of the Reserve Bank of Australia, The Journey of Financial Reform, Address to the Australian Chamber of Commerce in Shanghai, Shanghai, 24 April 2013.

[13]      Clancy Yeates, 'Currency deal to hasten $120 billion worth of trade', Sydney Morning Herald, 8 May 2013.

[14]      Australian Financial Centre Task Force, 'RMB invoicing in a longer-run context: opportunities and opportunities for Australia ' http://www.treasury.gov.au/PublicationsAndMedia/Events/~/media/Treasury/Publications%20and%20Media/Events/RMB%20Dialogue/Documents/RMB_Internationalisation_Opportunities_and_Challenges_pdf.ashx (accessed 24 May 2013).

[15]      'Corporate attitudes toward renminbi trade settlement and investment', Document supplied by the Reserve Bank of Australia http://www.treasury.gov.au/PublicationsAndMedia/Events/~/media/Treasury/Publications%20and%20Media/Events/RMB%20Dialogue/Documents/Corporate_Attitudes_towards_Renminbi_Trade_Settlement_and_Investment.ashx (accessed 24 June 2013).

[16]      Dr Philip Lowe, Deputy Governor of the Reserve Bank of Australia, The Journey of Financial Reform, Address to the Australian Chamber of Commerce in Shanghai, Shanghai, 24 April 2013.

[17]      ABC News Business Today, Transcript, 26 April 2013, http://www.trademinister.gov.au/transcripts/2013/ce_tr_130426.html (accessed 18 May 2013).

[18]      Department of Foreign Affairs and Trade, 'Australia–China Free Trade Agreement negotiations', June 2013, http://www.dfat.gov.au/fta/acfta/130606_subscriber_update.html (accessed 24 June 2013).

[19]      All foreign government investors must notify the Australian Government and get prior approval before making a direct investment in Australia, regardless of the value of the investment.

Foreign persons should notify the Government and get prior approval before acquiring a substantial interest in a corporation or control of an Australian business that is valued above A$248 million. This threshold does not apply to investors from New Zealand and the United States, except where the investment is in 'prescribed sensitive sectors'. Treasury, Australia's Foreign Investment Policy, 2013, pp 2–3.

[20]      Treasury, Australia's Foreign Investment Policy, 2013, http://www.firb.gov.au/content/_downloads/AFIP_2013.pdf (accessed 17 May 2013).

[21]      Senate Rural and Regional Affairs and Transport References Committee, Examination of the Foreign Investment Review Board National Interest Test, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Rural_and_Regional_Affairs_and_Transport/Completed%20inquiries/2012-13/firb2011/tor (accessed 18 May 2013).

[22]      The Hon. Craig Emerson MP, Minister for Trade, Interview with ABC News Business Today, Transcript, 26 April 2013.

[23]      The Hon. Craig Emerson MP, Minister for Trade, Interview with ABC News Business Today, Transcript, 26 April 2013.

[24]      Andrew Silberberg and Amelia Jamieson, 'Pessimistic outlook on FIRB Chinese decisions could prove unfounded', Arnold Bloch Liebler, http://www.abl.com.au/ablattach/ablarticle280313.pdf (accessed 17 May 2013).

[25]      AustralianSuper is a multi-industry employer superannuation fund.

[26]      The committee's tight schedule did not allow time to meet with AustralianSuper representatives or officials from the Ministry of Commerce (MOFCOM).

[27]      Australian Chamber of Commerce Financial Services Working Group, Australian Financial Service Business in China, Issues Paper 2011.

[28]      Australian Chamber of Commerce Financial Services Working Group, Australian Financial Service Business in China, 2012 White Paper, http://www.austchamshanghai.com/ftp/event/AustCham%20White%20Paper%20ENlr.pdf (accessed 14 May 2013).

[29]      Delegation's discussions with Australian bank representatives at the Australian Embassy in Beijing, 6 May 2013.

[30]      See 'ANZ continues China expansion with new branch in Hangzhou', AustCham, http://www.austcham.org/about-us/news/2013/jan/18/anz-continues-china-expansion-new-branch-hangzhou (accessed 19 May 2013).

[31]      Hannah Lynch, 'ANZ Bank investing $A300 million to expand China network', The National Business Review, 16 May 2012, http://www.nbr.co.nz/article/anz-bank-investing-a300m-expand-china-network-wb-118883 (accessed 20 May 2013).

[32]      Commonwealth Bank of Australia, 'Commonwealth Bank to open County Bank in China', 9 February 2011,  http://www.commbank.com.au/about-us/news/media-releases/2011/090211-commonwealth-bank-to-open-county-bank-in-china.html (accessed 24 June 2013).

[33]      Australian Chamber of Commerce Financial Services Working Group, Australian Financial Service Business in China, 2012 White Paper, http://www.austchamshanghai.com/ftp/event/AustCham%20White%20Paper%20ENlr.pdf (accessed 14 May 2013).

[34]      Treasury briefing provided to delegation members, 'Chinese Financial System Overview', received 3 May 2013.

[35]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 53.

[36]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 57.

[37]      The policy banks were separated from the commercial banks in the mid-1990s.

[38]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 57.

[39]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 57.

[40]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 57.

[41]      Treasury briefing provided to delegation members, 'Chinese Financial System Overview', received 3 May 2013.

[42]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 57.

[43]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 60.

[44]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 59.

[45]      Treasury briefing provided to delegation members, 'Chinese Financial System Overview', received 3 May 2013.

[46]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 56.

[47]      Treasury briefing provided to Delegation members, 'Chinese Financial System Overview', received 3 May 2013.

[48]      Memorandum of Understanding regarding Securities and Futures regulatory cooperation between the Australian Securities and Investments Commission and the China Securities Regulatory Commission, May 1996, http://www.asic.gov.au/asic/pdflib.nsf/LookupByFileName/China_SRC_MOU_1996.pdf/$file/China_SRC_MOU_1996.pdf (accessed 18 May 2013).

[49]      Discussion with officials from the CSRC, 9 May 2013, Shanghai.

[50]      Grant Turner, Nicholas Tan and Dena Sadeghian, 'The Chinese Banking System', Reserve Bank of Australia Bulletin, September Quarter 2012, p. 58.

[51]      The Standing Committee is responsible to the NPC and is the highest body of state power. Its five-year term coincides with that of the NPC and operates in a supervisory role when the NPC is not in session. See: National People's Congress, http://www.china.org.cn/english/27743.htm (accessed 18 May 2013).

[52]      Parliamentary Joint Committee on Corporations and Financial Services, Access to finance for small- and medium sized businesses, April 2011.

[53]      These measures enable small businesses to immediately write off the cost of asset purchases under A$6,500 and enable companies to carry back up to A$1 million worth of losses to get a refund of tax paid in the previous year.

Chapter 2 - The delegation's discussions on financial sector reform and market access

[1]        Discussion with Financial and Economic Committee of the National People's Congress, Beijing, 6 May 2013.

[2]        Mr Bernie Fraser, 'Foreign banks in Australia', Reserve Bank Bulletin, September 1994, p. 17.

[3]        Discussion with members of the Financial and Economic Committee of the National People's Congress, Beijing, 6 May 2013.

[4]        Discussion with Chinese academic economists, Shanghai, 10 May 2013. 

[5]        Dr Martin Parkinson, Address to Australia–Hong Kong Renminbi Trade and Investment Dialogue, 12 April 2013, http://www.treasury.gov.au/PublicationsAndMedia/Speeches/2013/Australias-place-in-the-new-global-economy (accessed 24 May 2013).

[6]        Discussion with the China Securities Regulatory Commission, Beijing, 7 May 2013; Discussion with the China Banking Regulatory Commission, Shanghai, 10 May 2013.

[7]        David Barboza and Chris Buckley, 'China Plans to reduce state's role in economy', New York Times, 24 May 2013. A copy of the directive from the Chinese Government (in Mandarin) can be found at the following site: http://www.gov.cn/zwgk/2013-05/24/content_2410444.htm (accessed 29 May 2013).

[8]        David Barboza and Chris Buckley, 'China Plans to reduce state's role in economy', New York Times, 24 May 2013.

[9]        Discussion with Australian banks and Macquarie Wealth at the Australian Consulate in Shanghai, 9 May 2013.

[10]      Discussions with Australian bank representatives in Beijing on 6 May 2013 and in Shanghai on 9 May 2013.

[11]      Discussions with academic economists, Shanghai, 10 May 2013; discussions with Australian bank representatives in Beijing on 6 May and in Shanghai on 9 May 2013; discussions with Australian banks and Macquarie Wealth at the Australian Consulate in Shanghai, 9 May 2013.

[12]      Mr Yi Gang, Deputy Governor, People's Bank of China, IMF Annual Meetings, 17 April 2013.

[13]      'China must push ahead with exchange rate reforms', East Asia Forum, 29 April 2013.

[14]      Australian Chamber of Commerce Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, p. 7.

[15]      Discussion with the Australian Consul-General and Consulate staff in Shanghai, 9 May 2013.

[16]      Confidential document provided to the committee, Australian Treasury, February 2013.

[17]      Confidential document provided to the committee, Australian Treasury, February 2013.

[18]      Organisation for Economic Cooperation and Development, Corporate Governance of Listed Companies in China, 2011, p. 16.

[19]      Organisation for Economic Cooperation and Development, Corporate Governance of Listed Companies in China, 2011, p. 16.

[20]      Organisation for Economic Cooperation and Development, Corporate Governance of Listed Companies in China, 2011, p. 16.

[21]      Australian Securities and Investments Commission, Corporate Law Economic Reform Program, http://www.asic.gov.au/asic/ASIC.NSF/byHeadline/CLERP (accessed 24 June 2013).

[22]      China Securities Regulatory Commission, Mr Xiao Gang, Biography, http://www.csrc.gov.cn/pub/csrc_en/about/who/xiaogang/ (accessed 24 June 2013).

[23]      Meeting with Mr Zeng Jifeng and Mr Wu Meng, China Securities Regulatory Commission, Shanghai Bureau, 9 May 2013.

[24]      China Securities Regulatory Commission, 'CSRC issues the notice on conducting a special inspection of IPO companies' 2012 reports', 28 December 2012 http://www.csrc.gov.cn/pub/csrc_en/newsfacts/release/201301/t20130109_220240.htm (accessed 25 June 2013).

[25]      Cong Mu, 'New IPO experts better than nothing: expert', Global Times, 4 February 2013.

[26]      'CSRC terminates review of 200 listing application', ChinaScope Financial, 24 May 2013, http://www.chinascopefinancial.com/en/news/post/26405.html (accessed 25 June 2013).

[27]      See 'CSRC releases stringent IPO rules as Xiao tackles fraud', Bloomberg, 8 June 2013, http://www.bloomberg.com/news/2013-06-07/csrc-releases-stringent-ipo-rules-as-xiao-tackles-fraud.html (accessed 25 June 2013).

[28]      Discussion with Australian bank representatives, Australian Consulate in Shanghai, 9 May 2013.

[29]      Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, pp 7–11.

[30]      Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, pp 7–11.

[31]      Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, pp 7–11.

[32]      Article 6(1), Provisions of the Administration of Foreign Exchange in Domestic Securities Investments of Qualified Foreign Institutional Investors. Article 9 sets the 'lock-up' period for pension funds, insurance funds, common funds, donation funds, and government and currency administration at three months. For other types of QFII, the lock-up period is one year.

[33]      Article 7, Provisions of the Administration of Foreign Exchange in Domestic Securities Investments of Qualified Foreign Institutional Investors.

[34]      Keith Robinson, Karl Egbert, Jingzhou Tao and Gregory Louvel, 'The Qualified Foreign Institutional Investor Program in China – Recent Developments, New Opportunities and Ongoing Challenges', The Investment Lawyer, February 2013, p. 4, http://www.dechert.com/files/Publication/a07259f1-1fd6-4283-8ad2-858483a5b595/Presentation/PublicationAttachment/fdf9e573-daa7-49b7-9a4d-793810efe4e9/IL%20Feb%202013%20Robinson%20article.pdf (accessed 25 June 2013).

[35]      Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, p. 12.

[36]      China Development Bank, Powerpoint presentation, 10 May 2013, Slide 18.

[37]      China Development Bank, Powerpoint presentation, 10 May 2013, Slide 19.

[38]      China Development Bank, Powerpoint presentation, 10 May 2013, Slide 5.

[39]      China Development Bank, Powerpoint presentation, 10 May 2013, Slide 5.

[40]      Foreign Investment Review Board, Annual Report 2011–12, p. 20.

[41]      Foreign Investment Review Board, Annual Report 2011–12, p. 30.

[42]      Foreign Investment Review Board, Annual Report 2011–12, p. 20; Foreign Investment Review Board, Annual Report 2010–11, p. iii.

[43]      Foreign Investment Review Board, Annual Reports 2004–05 to 2011–12.

[44]      Australian Treasury, Australia's Foreign Investment Policy, 2013, http://www.firb.gov.au/content/_downloads/AFIP_2013.pdf (accessed 25 June 2013).

[45]      This view was put by Professor Peter Drysdale and Professor Christopher Findlay, 'Chinese foreign direct investment in the Australian resource sector', China's New Place in a World in Crisis, Ross Garnaut, Ligang Song, Wing Thye Woo (eds.), 2009, p. 380.

Chapter 3 - The delegation's views and recommendations

[1]        Australian Government, Australia in the Asian Century, October 2012, p. 21. http://asiancentury.dpmc.gov.au/sites/default/files/white-paper/australia-in-the-asian-century-white-paper.pdf (accessed 24 June 2013).

[2]        Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, p. 7.

[3]        Australian Financial Services Business in China, 2012 White Paper, p. 9.

[4]        Australian Financial Services Business in China, 2012 White Paper, p. 10.

[5]        Australian Financial Services Business in China, 2012 White Paper, p. 12.

[6]        Australian Financial Services Business in China, 2012 White Paper, p. 14.

[7]        Australian Financial Services Business in China, 2012 White Paper, p. 14.

[8]        Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, p. 15.

[9]        Australian Chamber of Commerce, Beijing and Shanghai, Financial Services Working Group, Australian Financial Services Business in China, 2012 White Paper, p. 18.

[10]      Discussion with Australian banks and Macquarie Wealth at the Australian Consulate in Shanghai, 9 May 2013.

[11]      Discussion with Australian banks and Macquarie Wealth at the Australian Consulate in Shanghai, 9 May 2013.

[12]      Department of Foreign Affairs and Trade, The G20, http://www.dfat.gov.au/trade/g20/ (accessed 24 June 2013).