By LI Linxu

In its latest move to facilitate sci-tech innovation, China has unveiled a new plan to set up financial reform pilot zones for sci-tech innovation in five cities in the Yangtze River Delta region — Shanghai, Nanjing, Hangzhou, Hefei and Jiaxing.

In five years' time, these pilot zones are expected to be cultivated into demonstration zones for sci-tech innovation and finance cooperation, clusters for product and service innovation, and leading zones for industry and city integration, according to a notice jointly released by eight government bodies, including the People's Bank of China, the National Development and Reform Commission, and the Ministry of Science and Technology.

Experts believe that aiming to better link finance, sci-tech and industries, these pilot zones, located in China's most economically dynamic regions, will further advance the coordinated development of original innovation, technological innovation and industrial innovation.

Under the plan, Shanghai will be promoted as an international financial hub and a sci-tech innovation center with global influence, Nanjing as a leading natioanal innovative city, and Hefei as a place of origin for sci-tech innovation with international influence as well as a hub for emerging industries.

Shanghai's Pudong New Area. (PHOTO: VCG)

Hangzhou is positioned as a "practice window" to build a modern sci-tech innovation financial system, as well as a demonstration base for finance serving sci-tech innovation and development, while Jiaxing is seen as a highland for the transformation of sci-tech achievements in the Yangtze River Delta, as well as a service base for the integration of sci-tech innovation and finance. Both Hangzhou and Jiaxing are located in Zhejiang province.

To achieve these goals, the plan puts forward a series of measures, such as improving organizational systems of sci-tech financial institutions, promoting innovation in sci-tech financial products, and leveraging multi-tiered capital market systems.

Advancing the sci-tech empowerment for finance, consolidating the foundation of sci-tech finance, and improving relevant regulation capabilities are also among the measures.

Of particular note is that cross-border investment and financing are encouraged in the pilot zones. It welcomes foreign private equity firms to invest in onshore technology companies via the QFLP (Qualified Foreign Limited Partnership) route. Qualified domestic financial institutions are encouraged to take part in mergers and acquisitions of overseas technology companies via the QDLP (Qualified Domestic Limited Partnership) route.

Meanwhile, sci-tech innovative companies are encouraged to raise capital in both the domestic and overseas markets, and list shares and bonds in regional equity markets.