§ Dame Jill KnightTo ask the Chancellor of the Exchequer what was the purpose of the Economic Secretary's recent visit to China. [1181]
§ Mrs. Angela KnightThe principal purpose of the visit was to sign the memorandum of understanding on the exchange of information and mutual assistance in securities and futures matters between the Treasury, the Securities and Investments Board and the China Securities Regulatory Commission. I also took the opportunity to call on the state organisations which are at the forefront in China's economic reform. I was accompanied by Sir 63W Andrew Large, chairman of the SIB, co-signatory to the MOU, Ian Salter, the deputy chairman of the London stock exchange and a delegation of senior executives from the financial services sector.
The memorandum of understanding is a landmark agreement between the United Kingdom and Chinese authorities and is the result of two years' intensive negotiation by the Treasury, the SIB and the London stock exchange. It is of immense importance to our financial services industry in opening the gates to allow it to participate in and contribute to the rapid development of China's financial services sector. In particular, it will allow Chinese companies to list on the London stock exchange. The Chinese authorities have formally recognised London's status as the international financial centre. We are the first European country to receive official Chinese recognition and the first European stock exchange to be selected for listing. The MOU signing ceremony received considerable Chinese press and media coverage.
We were welcomed extremely warmly by all our Chinese hosts and I have no doubt that this historic agreement will strengthen the increasingly close wider relations between our Government and China. My task in the financial services area was considerably eased by the successful recent visits by the Deputy Prime Minister, the President of the Board of Trade, the Minister for Trade and the Minister of State, Foreign and Commonwealth Office.
The memorandum of understanding also has provisions for technical co-operation. My Chinese hosts impressed on me how much they can learn from London, both from a regulatory perspective and from our privatisation experience. The signing of the memorandum will therefore involve us closely in China's future economic development as the development of China's capital markets will play a key role in its economic reforms. The Chinese stressed their specialist training and educational needs and we have considerable expertise in this area.
In addition to my hosts at the CSRC, I also called on Vice-Minister Wang Chunzheng of the State Planning Commission, Assistant Minister Gao Qiang of the Ministry of Finance, Mr. Zhou Zhengqing, the Deputy Secretary General of the State Council, Deputy Governor Chen Yuan of the People's Bank of China and Vice-Minister Wu Jie of the State Commission for Restructuring Economic Systems. I took the opportunity at these meetings to emphasise London's international importance as a financial centre and the range and depth of our expertise to assist with China's economic reforms. I also took the opportunity to lobby on behalf of British banks—more branches and Reminbi (RMB) banking—and insurance companies seeking licences. On the banking front, it now seems certain that a British bank will be able to participate in local Reminbi banking which is a major step forward. The Chinese repeated their assurances that British companies would receive insurance licences in the near future.
This was a very successful delegation which I believe marks a significant step forward in our relations with China, both on financial services and more widely. We now need to maintain and build on these opportunities.
64WCopies of the memorandum of understanding are available in the Libraries of the House.