Financial antitrust, financial support for the internationalization of new rural areas
--On the Integration of Financial Trade Policy and Financial Competition Policy
Li Zhen

With the state-owned commercial banks' removal and merger of branches and business outlets in rural areas in pursuit of maximum benefits, the competition participants in China's rural financial market have decreased significantly. The rural financial market is almost divided by rural credit cooperatives and rural cooperative banks, forming a highly monopolistic pattern in China's rural financial market. During this period, the liberalization of financial and trade policies has promoted the global capital flow. China is regarded as another important position in the world financial battlefield. Some foreign financial institutions lock in the rural areas with high market concentration, actively penetrate the rural financial market, and land in China by participating in the rural credit cooperatives and rural cooperative banks. Objectively, it has formed a trend of "state-owned commercial banks shrinking to the rural market, and foreign financial institutions penetrating into rural strategies".
In recent years, the field of "agriculture, rural areas and farmers" has been the focus of our government's support. It can be expected that the rural financial market has huge potential, and the financial services targeting "agriculture, rural areas and farmers" will eventually benefit from our future policy guidance. From the regional perspective, although the rural credit cooperatives and rural cooperative banks can actively promote the rural financial market due to their large number of outlets, convenience for local farmers, and management experience and risk control ability brought by foreign capital investment, however, due to the lack of necessary market participants, The monopolist of the rural financial market may make profits at the cost of sacrificing the maximum social welfare of farmers. In order to enable farmers to truly enjoy the benefits brought by competition, the existing structure of the rural financial market needs to be broken through the establishment of financial competition policies with the financial antitrust system as the main body.
According to the WTO commitments, China's five-year buffer period will end, and both at home and abroad are highly concerned about China's financial trends in the future. After nearly five years of adjustment and transformation of the financial industry, under the guidance of domestic financial and trade policies, China is gradually realizing the free and open financial industry. However, an open financial and trade policy can only be a bridge between countries, and financial competition policy is the key to open the market between countries. In 1996, taking into account the connection between trade policy and competition policy, the WTO established the Working Group on the Interaction between Trade and Competition Policy WGTCP at the Singapore Ministerial Conference. Looking closely at China's financial trade policy and financial competition policy, the starting speed of the latter is far behind the former.
At present, there are many hot spots in the financial sector, such as financial holding companies, corporate governance in the banking industry, delisting of financial institutions and deposit insurance system. However, financial competition policies with financial antitrust as the core are rarely discussed. Since monetary policy, financial stability, foreign exchange management, credit reporting management and anti money laundering constitute the functional supervision basis of the financial antitrust regulation system, China should fully learn from foreign experience and quickly establish a sound financial antitrust system, as an important attribution point for the smooth implementation of financial and trade policies. In the future legislative process, at the international level, in order to maximize the effectiveness of financial and trade policies, the authorities can start with the GATS system, clean up the GATS exclusions, and explore the original intention of the exclusions, so as to serve as the basis for the establishment of an effective financial antitrust regulation system.

Author information:
Li Zhen, working in Kunming Central Branch of the People's Bank of China, Master of Law, e-mail: stanleeinchina@yahoo.com