City policies encourage the arrival of companies and investment products

The coastal city of Qingdao in East China's Shandong province is on track to become a global wealth management center, said a city leader.

The central government's decision to launch a financial pilot zone in Qingdao earlier this year is set to give a huge boost to the city's development, said Qingdao Vice Mayor Liu Mingjun.

Qingdao Financial Street, part of the city's growing prowess in banking, trade and investment. Photos Provided to China Daily

"The city will explore new models of development in its quest to become a leading world center for wealth management," Liu said.

Wealth management is an emerging business that involves investment advice, financial planning, investment portfolio management and a number of other financial services for both private and corporate clients.

It is an important and vibrant part of the financial industry in the West, he said.

New York and London have long been the world-class wealth management centers. Only in recent years has the business begun to prosper in emerging markets such as China.

The country's stable monetary policy and increasing public awareness of wealth management mean the reform in Qingdao came at the right time, Liu said.

"As a leading representative of the emerging market, China is set to create a huge wealth management market and therefore an emerging wealth management center," Liu said.

The country has already become the world's second-largest economy and home to the largest foreign reserves. There is growing domestic demand for wealth management along with an increasing number of rich people.

Qingdao has its own unique advantages to become such a center, Liu said.

"Based on its resources and business-friendly investment environment, Qingdao will be fully capable of developing the wealth management market," Liu said.

He said the city's wealth management sector is now represented by a large number of private banking operations, wealth management companies, mutual fund companies, private equity firms and various other financial institutions.

To build the structure for a global wealth management center, the city will speed up establishment of a regional equity exchange and precious metals exchange while fostering a market for high-end consumer products and art collections, Liu said.

It will explore cross-border wealth management services and launch pilot projects to reform the foreign exchange management system, he said.

"Sensing a huge potential and growing demand, the central government hopes Qingdao will explore a model of successful wealth management center," Liu said.

Qingdao is currently the site of more than 10 wealth management centers. Nine banks in the city already have set up their own private banking departments.

"Wealth management will help channel the money to the most competitive part of the economy, therefore boosting the adjustment of industrial structure," he said.

A large batch of financial institutions and talent working in the trade will be attracted to the city, Liu said.

The center will also inject vitality to a series of related industries such as tourism and exhibitions.

The coastal city has always been a major player in the economic development of Northeast Asia.

It takes about one hour to fly from Qingdao to Beijing, Shanghai, Tokyo and Seoul.

The city's economy also has distinctive characteristics. It is particularly strong in the port, marine, tourism industries.

Its per capita GDP has reached $14,000, nearing the level of high-income countries.

The annual per capita disposable income in the city reached 35,000 yuan ($5,600).

It also has a solid industrial foundation, which paves way for the construction of a global wealth management center.

The city is also home to the internationally known companies Haier, Hisense and Tsingtao Beer.

The good living environment is also a plus for the city. As one of the best tourism destinations in the country, the city is known for its moderate climate and beautiful beaches.

It has been hosting a series of high-level events as a showcase of its influence.

The city is also an important transportation hub in Northeast Asia, with Qingdao port ranking seventh in the world in cargo volume.

The city now has more than a dozen of international flights to cities ranging from Frankfurt to Los Angeles.

xiechuanjiao@chinadaily.com.cn