Shanghai aims higher for offshore finance

An action plan to develop offshore finance in Shanghai was released on Wednesday, as the two-day 2026 Lujiazui Forum kicked off.

To better address companies' outbound reaches, Shanghai, as an international financial center, should have the business rules and systems for offshore finance initially established by the end of 2027, according to the action plan jointly released by central financial regulatory bodies and the Shanghai municipal government.

A relatively mature financial mechanism and legal system should be formulated in the city by the end of 2030, providing reliable financial services for Chinese companies' international investment and trade. These will also facilitate the institutional reform tests for onshore finance, which is conducive to renminbi's global asset allocation and risk management functions.

By the end of 2035, Shanghai should grow into a strategic hub that coordinates offshore and onshore financial services, leading China's high-level financial opening-up and high-quality development, the action plan said.

Banks will be encouraged to use Free Trade accounts to offer offshore trade, leasing, shipping, and global treasury management services. Free Trade accounting units within the China (Shanghai) Pilot Free Trade Zone will be supported to invest in offshore bonds within special quotas. The international operation center for the e-CNY, which went operational in September, will facilitate cross-border and offshore digital renminbi applications and infrastructure connectivity.

Pudong New Area will take the lead in piloting offshore financial services, including RMB's offshore trade, cross-border trade settlement, and overseas financing.

The first batch of pilot businesses will include offshore bond, offshore reinsurance, capital management of companies' treasury centers, offshore RMB foreign exchange trade, and non-resident individual financial services.

The pioneering attempts may expand to providing more offshore banking products and services. Efforts will be made to study the viability of offshore financial asset transfers. Asset managers will be supported to develop products in line with client needs and international rules, which will be part of Shanghai's efforts to explore offshore asset management businesses. Family trusts and family offices should grow steadily in the city so that Shanghai can become a leading offshore wealth management center, the action plan said.