by Xinhua writer Ma Qian
NEW YORK, April 8 (Xinhua) -- China has been opening up its market and going on a right path by being fully aware of its own issues, U.S. leading investment bank and financial services company JPMorgan Chase & Co's chairman and CEO Jamie Dimon said Thursday .
"They've been reforming all the time ... They've been opening up their markets," Dimon said during a discussion event in New York City.
OPTIMISM ON FURTHER OPENING UP
He noted that having "a healthy, transformational rule of law" and "transparent financial markets" would help Chinese stock and bond markets expand effectively and "make China a healthier country over time."
In his annual letter to stakeholders released Thursday, Dimon said the Chinese have been on a high-speed path that includes increasing transparency and economic reform.
"While the momentum slows down periodically, they have continued relentlessly on that path," he said.
Noting that China has done a highly effective job of getting itself to the current economic development level, he pointed out that China has been confronting some problems including rising corporate and government debt levels.
Yet he stressed the Chinese authorities have been "well aware of these issues and talked about many of them quite openly."
The CEO also cautioned that China and the rest of the world would probably face more uncertainty and moments of slower growth than in the past, pointing out that a disruption of trade is another risk for China.
Yet he expressed some optimism for China's capability to handle complex issues and for the prospect on U.S.-China trade talks.
"China can deal with many serious situations because it can both macro-manage and micro-manage its economy and move very fast," Dimon said in his letter.
"We believe the odds are high that a fair trade deal will eventually be worked out -- but if not, there could be serious repercussions," he stressed.
"If China and the United States can maintain a healthy strategic and economic relationship (and that should be our goal), it could greatly benefit both countries, as well as the rest of the world," he noted.
EYES ON OPPORTUNITIES IN CHINA'S FINANCIAL MARKET
JPMorgan Chase has been seeking to further strengthen its market presence in China to better support their clients globally, as it is a Chinese government bond underwriter, an official Bond Connect market maker and a Type-A bond settlement agent in China interbank bond market, according to the investment bank.
"China is one of the largest and fastest growing markets in the world and represents one of the most exciting opportunities for many of our clients and our firm," Nicolas Aguzin, chairman and CEO of J.P. Morgan Asia Pacific, said in a company statement on March 29.
"It's a critical component of our growth plans globally as well as in Asia Pacific," said Aguzin. In its efforts to attract more overseas investors, China has carried out a slew of reform measures to open up its capital market wider in recent years.
Launched in July 2017, a new mutual market access program Bond Connect provides a market access that allows overseas investors to invest in the Chinese mainland's interbank bond market using financial institutions of the mainland and Hong Kong.
Valued at 12 trillion U.S. dollars, China's domestic bond market has been the third largest in the world and is set to become even larger, JPMorgan Chase said in a research report on March 21, calling the inclusion of China's weight into a Bloomberg global index in April a "welcome boost" to the country's efforts to liberalize its economy.
The Bloomberg Barclays Global Aggregate Index has begun to include China's yuan-demoninated government and policy bank bonds since Monday, with a 20-month phase-in period.
"The inclusion represents an important milestone for China as it continues to strengthen and liberalize its capital market and looks to attract more international investors," Mark Leung, CEO of J.P. Morgan China, said in the research.
As China has been placed on a watch list for inclusion in the J.P. Morgan Emerging Markets Government Bond Index Global Diversified since 2016, the investment bank will survey investor sentiment over the issue at its annual index governance meetings over the upcoming summer, according to the research.
"We believe China's accessibility is continuing to develop in the right direction and can meet full inclusion," said Gloria Kim, head of the global index research group at J.P. Morgan.
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