China's Financial Liberalization: Specific Aspects and Effects6

Abstract

The article is devoted to studying financial liberalization in China. The study is identified the main stages of financial liberalization and its adjustments depending on internal and external circumstances. A new international financial crisis is growing and has already begun to affect China's economy. A comparative analysis of China and the G20 developing countries was carried out in terms of financial openness and financial integration into the global financial system, cryptocurrencies regulations and digital national currency, features of economic policy and the state of the external financial sector. China's liberalization policy began with the removal of restrictions on foreign direct investment and the current account. The priorities of the financial liberalization policy is changed by reason of the economy grows and develops: from domestic economic development to the financial expansion of other countries in order to gain access to new markets and technologies. But most restrictions on the movement capital remain in China. The use of cryptocurrencies as an opportunity to circumvent currency restrictions is legally prohibited, and instead an attempt is being made to impose a national digital currency on society. The degree of government participation in the economy plays an important financial liberalization. Comparing other developing countries, China has a much higher degree of government involvement in the economy. This allows to maintain macroeconomic stability within the country even during international financial and economic crises. It is concluded that a gradual and partial financial liberalization with the maintaining domestic macroeconomic stability will provide the best results.