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Foreign insurers could get free rein across China within 18 months

BritCham / CBBC
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Asia Insurance Review, 29/04/15

 

Foreign insurers are to be given full access to China within 18 months as control of state-owned financial institutions is re-centralised, reported Asian Investor citing an adviser to Premier Li Keqiang. 
 
Amongst other major changes, foreign insurers in China will be released from current geographical constraints and given the freedom to conduct business across the country, said Mr Richard Surrency, Managing Director of capital strategy at Singapore-based Algebris Investments (Asia). He is one of several international investment chiefs on a panel of experts advising Mr Li on the development of China's capital markets. 
 
According to Mr Surrency, Mr Li had told domestic insurers: "I've given you the chance to grow your business free of foreign competition. If you haven't got your business together by now, watch out because major foreign insurers will soon be given the right to compete directly with you." 
 
Foreign insurers are currently restricted to operating in quasi-regional jurisdictions, but Mr Surrency said: "They are now going to have all of China to play with, in the next year to 18 months." 
 
There is a wider strategy of re-centralisation that is taking place. Mr Surrency said: "I have not seen anything like this. We used to hear regional heads of insurance and banking boast how they had autonomy from Beijing, but those days are over. Now before any decision is made they will say they have to check with Beijing first. Control is returning to Beijing and the speed at which it has occurred is unprecedented."
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