China enlists ex-World Bank economist to help run Guangdong, sparking hopes of Greater Bay Area reform
- Zhang Xin, a Columbia Business School graduate and former central bank and foreign exchange regulatory official, is viewed as a reformer
- He helped steer the World Bank’s response to the Asian financial crisis of 1997, with one of his key prescriptions being capital market reform
China has enlisted a New York-educated former World Bank economist to help run one of its major economic engines, fuelling hopes that greater financial opening could be in store for 2020 and beyond.
It is perhaps his previous experience in the US, however, which is most eye-catching. After receiving his doctorate in finance at Columbia Business School in 1997, Zhang worked as a senior financial economist at the World Bank, helping steer the Washington institute’s response to the Asian financial crisis in the same year.
Zhang’s international finance background is outstanding, which will benefit the Greater Bay Area scheme
Among his approaches to the crisis was revamping capital markets in countries with unstable financial systems. Zhang returned to China in 2001 to work at the China Securities Regulatory Commission. In 2004, he was made deputy chief of the financial stability bureau at the People’s Bank of China, then promoted to chief a year later.
Guangdong analysts said that this track record of pursuing reform both domestically and overseas could help put China’s most populous province and primary tech hub on the path to further liberalisation.
“It has been common practice in recent years to have at least one experienced financial specialist as Guangdong’s deputy governor. Zhang’s international finance background is outstanding, which will benefit the Greater Bay Area scheme,” said Peng Peng, vice-president of the Guangdong System Reform Research Society, a think tank.
“Zhang’s experience could help Guangdong lure more foreign capital and promote renminbi internationalisation. If it promotes Guangzhou and Shenzhen’s international financial status effectively, it could help the two cities share some of Hong Kong’s financial functions,” Peng said.
Guo Wanda, vice-president at the China Development Institute, a Shenzhen think tank, said that one of the key tasks in Zhang’s inbox on day one will be the Hong Kong problem. The city has been beseeched by protests for more than half a year, which have laid ruin to its economy, leaving many to speculate that it will be integrated with the mainland more quickly than expected.
“Shenzhen now is responsible for how to solve the problem of financial cooperation with Hong Kong, and at the same time it undertakes the mission of China’s future financial innovation,” Guo said.
