Scientific innovation enterprises in Guangzhou's Huangpu district are now able to open free trade (FT) accounts that enable full convertibility of Chinese currency.
This benefitted from the recent exploration of the Guangzhou Branch of the People's Bank of China to broaden the application scope of the FT policy in Huangpu, with reference to that of Shanghai Free Trade Zone.
The launch ceremony of the first FT accounts of Huangpu scientific innovation enterprises is held on Dec 21. [Photo/Nanfang Plus]
The FT account is a convertible accounting system with renminbi as its base currency. It is convenient for enterprises to deal with the settlement of different currencies, avoiding the inconvenience of opening multiple accounts. In addition, the account can be used in conjunction with the e-bank for effective management.
Capital transfer between an FT account and an overseas account, a non-resident account, and an offshore account can be handled based on money collection and payment instructions. Free convertibility is allowed under the current account and direct investment.
An FT account is also applicable to the offshore exchange rate of renminbi. Enterprises can choose an FT account or a normal account for foreign exchange settlement and sale, enjoying preferential exchange rates in both offshore and onshore markets.
As of now, a dozen local enterprises have opened FT accounts, which will further facilitate cross-border transaction, investment, and financing, assist with the "going out" of Huangpu enterprises, as well as attract more foreign investment.