American Express to be the first institution to get the payment license for China
Last week we talked about President Trump's decision and the US Senate considering the delisting of the Chinese companies on the US stock exchanges.
In an announcement made yesterday, China opened up the $45 trillion financial market to foreign investors. The move was possible because the country's central bank licensed American Express to conduct transactions. It is the first license of such kind given to any foreign institution. Experts see this as a countermove to the American actions.
American Express's entrance in the Chinese market is a partnership between it and Lianlian DigiTech Co to clear yuan transactions on a market that is supposed to worth $27 trillion.
Even though American Express is the first one who got the payment clearance license, it is not the first American financial institution. At the beginning of the year, MasterCard got the green-light to set up bank card clearing services in China. In May, Fitch Ratings got approval from the People's Bank of China to rate the domestic bond market.
From analysts’ point of view, the opening of the Chinese markets represents a part of the deal signed in January between the two countries. Also, it shows the confidence that China has in globalization and openness toward foreign companies.
After the announcement, American Express stock price lost more than 2.50% during regular trading hours, but it recovered and even exceeded the loss by gaining 3.12% after-hours.
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Sources: forexfactory.com, globaltimes.cn, finance.yahoo.com
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