Rmb Business In The Full Liberalization Of China's Banking Market And Countermeasures

The global banking industry is witnessing the tremendous change of its competition environment and China is rolled up into the tide of financial globalization and liberalization soon after its entry into the WTO. The implementation of on Dec. 11th, 2006 has marked China's complete opening-up of its RMB business to foreign banks. The opening of our trade in banking services has entered a new era.This article has firstly reviewed the development history of international trade of banking services in China, focused on current situation and new features of foreign banks'recent development. Then the competition vantages of both domestic and foreign banks have been analyzed as follows: foreign banks have advantages in professional staff, management experience, advanced technology and capital power while domestic banks have advantages in profound knowledge in domestic market, well-structured net of branches and the recognition from domestic consumers due to long-time operation in China, which cannot be excelled by foreign banks in a short period of time.Based on the analysis above, the effect of complete opening of RMB business to foreign banks and domestic countermeasures have been discussed in the third part of this article. The part is firstly started with analysis from the angle of macroeconomics. It investigates in the opening's influence on effectiveness of macro economical policy and stability of macro economy and then raises suggestions in improving supervision on foreign banks. The following research is from the angle of microeconomics. On one hand, the article analyzes the opening's influence on domestic producers of banking products (namely domestic banks) and the countermeasures they should take. On the other hand, the article discusses the opening's influence on domestic consumers of banking products (namely enterprise and individual consumers) and raises suggestions accordingly.