China's Futures Market to Be Opened Further
In a substantial step towards opening its futures market, China has issued detailed rules on Hong Kong and Macau brokerage companies holding participating shares of mainland futures companies.
Under the supplementary CEPA agreement, intermediary organizations who meet requirements prescribed by China's Regulatory Commission may set up joint-venture futures brokerage companies in the mainland.
The hope is that the loosening of the belt buckle around the futures market will bring more advanced management experience into China, and open up a channel for mainland companies to strike deals overseas. Hong Kong and Macau will then serve as bridgehead for large mainland futures firms to extend their reaches into the international market.
But buyer beware ¨C some experts caution that the number of futures players is small, and certain futures products nowhere in sight. Foreign players seeking a piece of the pie will have to pay a price. And while the futures industry is currently a contributory one, the addition of joint venture companies will transform it into a profit-seeking industry ?? coming into conflict with the purpose of China's future industry.

Bidding Solution to Textile Quota Conundrum
China is likely to adopt a bidding method in allocating textile quotas for the next year, according to the China Chamber of Commerce for Import and Export of Textiles.
China Daily reports that this move is in reaction to requests by textile manufacturers, whose quotas are currently governed by shipments in the previous year. According to this method, a number of companies are only allocated small figures, amounting to several items or kilograms, in effect curtailing their export business.
Producers hope a decision will be reached in time for them to sign next year's contracts with foreign buyers in October ?? but sources from the Chamber warn that the bidding method will only affect 30-40% of the quotas, while others will remain status quo.

Citibank and China Union Pay Form Strategic Relationship
Citibank and China Union Pay announced that they would form a strategic relationship, with agent business for ATM as their first cooperative program. After upgrading RMB cards, China Union Pay cardholders will be able to withdraw foreign currencies from Citibank ATM networks in over 50 countries, while Citibank cardholders can also withdraw cash at China Union Pay outlets. This is the groundbreaking first step between China Union Pay and a foreign investment bank.
Citibank chairman William Rhodes noted that China is the largest and most important opportunity for his bank, excluding the bank??s home turf of America. As one of the strategic investors in Shanghai Pudong Development Bank, Citibank plans to increase its shares from less than 5% to 19.9%, the ceiling mark set by the government for foreign investment in a Chinese bank.

Foreigners Allowed in Settlement Institutions
The People's Bank of China has announced that foreign investors will soon be able to join hands with Chinese counterparts to establish settlement institutions, with the specific foreign stake to be determined according to China's commitment to the WTO, according to bank vice president Su Ning. With the surge of settlement institutions in China in recent years, and the potential for bank-card business, the central bank wishes ?°to make more efforts to standardize operation and strengthen supervision to ensure the safety of capital," Su promised.