Host
Wan Zhe，Chief Economist of International Cooperation Center of National Development and Reform Commission
Dialogue guest
Yu Liming，Vice General Manager, Guoxin International Investment Co.Ltd
Liu Shaobo，Dean of Economic College and Director of Finance Research Institute, Jinan University
Zhao Ping, Director of International Trade Research Department, Academy of China Council for the Promotion of for the International Trade
Choi Suhyun，Former Chairman of Korean Financial Services Commission
Kim Sangkuk, Special Adviser to the Minister of Foreign Affairs
Choi Gwangseok, Vice President of KCN Investment Cooperation
JeongYeonku，Director of Shinhan Investment Cooperation, China
Wan Zhe: Distinguished guests, everyone. In this cooperation dialogue, we invited guests from China and the Republic of Korea to discuss the prospects and future of trade and investment and financial cooperation with us. We can see that since the China-Korea Free Trade Agreement in 2015, China and South Korea’s economic and trade and financial exchanges are in very good and very close relationship. China is the largest foreign holder of South Korean bonds, the largest trading partner and the biggest investee. Therefore, China's relationship with South Korea is inseparable in the process of RMB internationalization, and both sides have made many contributions in supporting the economy, finance, and trade. We have had a delicate relationship in the economic and trade between the two countries in the past year or two. In general, we will definitely move towards a better future.
Of course, let's welcome all the distinguished guests here.
First, Han Seung-soo, the IFF Co-Chairman，Former Prime Minister of Republic of Korea and President of 56th Session of UN General Assembly, will give a speech.
Han Seung-soo: Thank you all. As IFF moved its headquarters from Beijing to Nansha, Guangzhou, the Greater Bay Area, we plan to further expand our scope of activities. I am very pleased to participate in the investment and financial cooperation conference of Chinese and Korean companies today. I hope that in this meeting today, everyone can share more opinions on the strengthening of financial cooperation between South Korea and China.
This year marks the 25th anniversary of the establishment of diplomatic relations between South Korea and China. In the long history of exchanges beyond the year of 2000, the people of the two countries have always felt very close because of the similarities in history and culture. Since the establishment of diplomatic relations in 1992, the relationship between the two countries has achieved tremendous development in all areas. The scale of trade between South Korea and China has also grown from US$6.3 billion to US$211.3 billion in 2016, reaching 33 times more than the beginning of the establishment of diplomatic relations in 1992. China has become Korea’s largest export and import trade country. The number of mutual visits exceeded 8 million. The two-way cultural flow with the Korean Wave and the Hanfeng has become an important foundation for the development of bilateral relations. On this basis, the relations between the ROK and China have further become a strategic partnership, and extensive cooperation has been carried out in the fields of peace and stability in Northeast Asia and even in global affairs.
I think that compared with this kind of multi-faceted close cooperation relationship, the exchanges between the two countries in the capital market are still not so active. I want to use IFF as the cornerstone to explore how to exchange and develop the capital markets of the two countries in Nansha. This is a good opportunity. As the second largest country in terms of global GDP, China has become the world's strongest in the real economy. In this regard, China's market economy status is still not consistent. Under the US dollar reserve system, the Anglo-American financial institutions dominate the market and contain the influence of China's emerging powers. This is also obvious to everyone.
Under such circumstances, China is creating new orders in global financial markets through measures such as the internationalization of the renminbi and the opening of the capital market. A week ago, on November 10th, the Chinese government just released a policy of opening up foreign capital to expand foreign capital in the financial capital market. I personally believe that in this competition in the global financial market, based on the long-term experience accumulated in the Korean capital market, we will jointly create a model of good cooperation between the Korean and Chinese capital markets. I think this may be helpful for China's financial capital market. I am very much looking forward to such cooperation. In the future, I will be able to focus on the IFF where I set up my headquarters in Nansha, thus contributing to the Chinese capital and financial market going global. Thank you!
Wan Zhe: Thank you, very wonderful and very warm speech. We hope that in the future China-ROK economic and trade relations, financial relations, etc., can play a greater role, thanks to Mr.Han Seung-soo.
Next, let's welcom Mr. Yu Liming, the Vice General Manager, Guoxin International Investment Co.Ltd, please.
Yu Liming: Thank you. Today is a Sino-Korean cooperative dialogue, especially in the context of the Greater Bay Area. First, we must first know South Korea. I will talk about some basic figures, then focus on today's theme, "Trade Investment and Financial Cooperation." South Korea actually has an area of 100,000 square kilometers and a population of 52 million. The total economic output in 2016 is 1.4 trillion US dollars. The area and population are equivalent to our Zhejiang Province. The total economic volume is actually equivalent to the Greater Bay Area, ranging the 11th in the world. South Korea is the world's top 15 economy and one of the fastest growing countries. Its growth rate among the major countries is only behind China and India. From 2010 to 2016, South Korea’s average economic growth rate was 3.48%, and its total GDP ranking rose from the 15th to the 11th globally. Recently, IFF raised the forecast of Korea’s economic growth in 2017 and expects economic growth this year to 3.2%.
South Korea has actually been China's largest source of imports, accounting for 10% of our total imports. South Korea’s total exports are 500 billion U.S. dollars, and one-third of them are exported to China. The number of foreigners entering South Korea is 18 million. Among them, just as the Prime Minister said, China has the largest number of tourists, accounting for more than 8 million, accounting for 47%. In 2016, South Korea invested 4.8 billion U.S. dollars in China, the third largest source of the foreign investment in China. South Korea is also the first country to sign a currency swap agreement with China, and recently renewed the agreement with a size of $56 billion. In a narrow sense, South Korea is not a Belt and Road country, while based on the principle of openness, South Korea is the "Belt and Road" participating country that also expressed its attitude and actively participate in the "Belt and Road" construction. These are the numbers we have seen in the past year. In fact, China-ROK economic cooperation, under the current situation, I personally believe that we must first strengthen political mutual trust, friendly dialogue and consultation to expand the common ground while reserving differences, and finding a constant line of cooperation in a changing international development environment.
In terms of trade, South Korea is China's third largest trading partner that has the largest deficit with China. Last year's deficit was close to the total import and export volume between China and France. China and South Korea trade is twice as much as that between the US and South Korea. The volume of South Korea's export to China is more than the sum of that of the United States and Hong Kong. In the trade volume, we see that the integrated circuit is the first, followed by the LCD screen of mobile phones. These products, mobile phones and computer components are all from Korea, and we have shipped them back to South Korea. This shows that the demand of our two sides have laid the foundation for smooth trade between the two countries. Korean vehicles and Korean wave are popular in China. In fact, they are derived from the promotion of the two countries’ free trade zones. From this perspective, China and South Korea should continue to expand the scale of trade, improve the trade structure, and carry out more win-win cooperation.
In terms of investment, in addition to consolidating the investment of both sides, China and South Korea can actually take advantage of technologies and capitals of the two sides in infrastructure construction such as roads, railways, ports, aviation, telecommunications, communication networks, shipbuilding, oil and gas pipelines, and heavy industry, to carry out joint investment in the world, especially for the United States and the countries along the “Belt and Road”. If a China-Korean consortium invests in infrastructure in the United States, the project will be easier to be approved. In this way, some geopolitical risks can be alleviated, the smooth implementation of the project can be guaranteed, and the expected economic benefits can be achieved.
In terms of financial cooperation, based on long-term cooperation, it is necessary to expand the settlement and exchange of local currencies as the basic way to promote the formation of a currency safety net in economic exchanges and increase their inherent ability to defend the financial security and economic interests. Taking the OLED display as an example, there is now a South Korean or Korean-related capital to enter the Chinese mainland to set up a factory. If South Korea accepts the construction of a factory with renminbi investment in South Korea and the products sold back to China in renminbi, so that It is possible to reduce the risk of the display industry shifting from South Korea to China and achieve win-win cooperation.
I feel that under our financial open policy, Korean companies can transfer these experiences and technologies on corporate bond to China for the Nansha financial island. South Korea is good at corporate debt, especially for small and medium-sized enterprises and has accumulated a lot of experience in risk control and other aspects. I think that both sides can develop more in these specific fields. Thank you all!
Wan Zhe: Thanks to the wonderful speech of Mr. Yu Liming. In the future, it is necessary to find a point of convergence to further strengthen mutual trust. Next, I would like to ask Mr. Liu Shaobo, Dean of Economic College and Director of Finance Research Institute, Jinan University, to speak. Please.
Liu Shaobo: In the future, China-ROK cooperation will be expanded or further strengthened in the following aspects:
First, how does finance promote the transformation and upgrading of the industry? Everyone knows that China is currently in a period of promoting industrial transformation, upgrading, innovation and development, and transforming its power. South Korea is one of the developing countries since the 1960s that has successfully bailed out of the mid-rate trap and entered into the high-income countries.
In this process, South Korea's been very successful in promoting its economic restructuring and upgrading through innovative development. What I am concerned about is how the Korean financial structure serves its transformation and upgrading of economic structure, industrial structure, and innovation structure in this process. As far as I know, South Korea's capital market is not very developed, and they mainly rely on the banking system. In theory, the banking system is difficult to adapt to innovation. Therefore, in this respect, China and South Korea can further explore and exchange. In the end, there is some experience in Korea's financial structure adjustment and service innovation transformation and upgrading. This is a very interesting topic.
Second, both of us can further expand and strengthen cooperation in the development of cross-border RMB business. The volume of trade between China and South Korea is very large. For example, from 2009 to 2016, at the end of June last year, China has carried out the cross-border RMB collection and payment business in 236 countries and regions. Among them, Hong Kong accounted for 54.9%, Singapore 10.2%, China Taiwan 5%, Japan 3.2%, Germany 3%, Britain 2.2%, China Macau 2%, the US 1.9%, and South Korea only 1.7%. In terms of trade volume, the proportion of our cross-border RMB collection and payment business seems to require further improvement. In Guangdong Province, the proportion of South Korea's cross-border RMB business is not large as well, only 1.5%, compared with 70.2% of Hong Kong, 6.6% of Taiwan and 3.2% of Macao. Therefore, I personally feel that we still have a lot of room for cooperation in the cross-border business of the RMB, cross-border settlement, trade financing, and payment. In terms of capital market and reserves, this is also in line with China's strategy of vigorously promoting the internationalization of the RMB. So the space for cooperation is still very big, because we have a good trading foundation.
Third, I think that in the future, the two countries can cooperate in some new areas, such as the financial technology. It is highly integrated with current technologies, especially Internet technologies, big data, cloud computing, and artificial intelligence, to promote innovation and development in the financial industry. In this regard, there is considerable room for cooperation between the two countries in the future.China has developed very fast in recent years, so there is a lot of experience that everyone can discuss together.
For example, China’s application of fintech reached 69% in the first half of this year, ranking first in the world, while the United States is 33%. In the first half of 2017, the investment in global financial technology was 53.02 billion yuan, of which China's technology companies received 21.7 billion yuan of investment, accounting for 41% of the world, while the United States only received 11.6 billion yuan. In other words, China has indeed developed very fast in this area in the past a few years, and the two sides can further expand cooperation in this field in the future.
In addition, the development of green finance is now a global trend. China has also attached great importance to it in recent years. For example, in the first half of this year, in the first half of 2017, China issued a total of 36 green bonds, valued at 77.67 billion yuan, a year-on-year increase of 278%. By the end of last year, China's non-ferrous financial environmental protection green funds had reached 265, of which green industry funds reached 215, mainly increased by more than 120 last year. South Korea has a lot of experience in promoting this. Therefore, this is also an area where both sides are very compatible.
In terms of the BRI, just like Mr. Yu said, there is a lot of room for development in this area. Institutions can strengthen cooperation in many ways, including financial policies.
Finally, in terms of regional financial policy coordination, as two countries with very close economic and trade relations, we can coordinate the financial policies, such as monetary policy, especially in the Asian regional cooperation. I think that Korea can also do a lot of things, and there is a lot of room for cooperation with China in this regard.
Wan Zhe: Thank you for your wonderful speech, Mr. Liu. You put forward a very good blueprint. China and South Korea should work together to have a better future. Next, we have invited Zhao Ping, Director of the International Trade Department of the China Council for the Promotion of International Trade, to share with you. Thank you, Ms. Zhao Ping.
Zhao Ping: Just a few speakers have mentioned that the cooperation under BRI between China and South Korea is very broad. I strongly agree with this view. The BRI is proposed by China, and we welcome Korea to participate in the BRI cooperation. Combined with China's five connectivity, the cooperation between China and South Korea is very good. The basis for cooperation between China and South Korea is particularly good, because China and South Korea have signed free trade agreements. At present, China has signed 14 free trade agreements with countries around the world. Therefore, future cooperation should be said to be based on a higher level of openness.
In the future, cooperation between China and South Korea may focus more on the important areas of connectivity, such as trade, financial and public relations. China's infrastructure construction has accumulated a lot of experience after 40 years of reform and opening up. China is the world leader in many fields, such as the high-speed railway, hydropower and power-related facilities.We not only have experience and technology, but also have more willingness to cooperate in these areas.
I believe that the prospects for future cooperation on China's current fastest-growing areas, e-commerce, will be even broader. After nearly 20 years of development, China's e-commerce has become the world's largest. The number of e-commerce-involved population has reached 751 million as of June this year. Such a huge market means that in the future, there will be more infrastructure for investment of e-commerce. For example, in the field of big data, cloud computing, and especially artificial intelligence, there will be more opportunities for future investment.
The future investment between China and South Korea can also focus on the cross-border e-commerce. China's cross-border e-commerce has shown rapid growth in recent years. Last year, cross-border e-commerce revenue growth rate is 30.7%. Due to the strong complementarity of trade between China and South Korea, we can cooperate on the cross-border e-commerce related infrastructure, such as overseas warehouses, etc., there is still much room for cooperation between China and South Korea. In addition, due to the strong complementarity of industrial structure between China and South Korea, the upstream and downstream cooperation of electrical appliances industry chain of our two countries is very close. South Korea is in the upstream, and their production technology of LCD panels and key components are particularly prominent. With the acceleration of the pace of internationalization of Chinese companies, many home appliance industries begin to go global. For example, recently, Hisense has acquired Toshiba in Japan, and Lenovo has acquired Fujitsu in Japan. Under such a background, the cooperation between the upstream and downstream of the industrial chain will be even broader.
Secondly, from the perspective of facilitation of trade, the trade commodities between China and South Korea are very complementary. South Korea mainly produces high value-added manufactured goods, while China is mainly based on the export of primary products and agricultural products. Therefore, the trade complementarity between the two countries is relatively strong, which means that we have more room for expansion in the future of trade methods. In particular, with the entry of many cosmetics, health care products and other products from South Korea into the Chinese market, the gap in the general trade market has been filled, which meets Chinese people’s demand for a better life after the income level has been continuously improved.
In the future, I believe that the space for cooperation in service trade is also very broad. For example, South Korea's Busan Port is a world-famous big port. For example, Busan Port and Shanghai's coastal port, the relatively close Dalian Port, Qingdao Port, etc., may have more room for cooperation in transportation service trade. Just as the tourism service trade mentioned by Mr. Han, the complementary characteristics between China and South Korea are also obvious. China has a long-term deficit in the tourism service trade with South Korea. How to further promote the growth of service trade through trade and investment cooperation between China and South Korea, will be an important topic to discuss about.
Fourth, the financial connectivity. We know that the financial infrastructure between China and South Korea is actually very good. Soon after we proposed the BRI, South Korea took the lead in signing a memorandum of understanding with China in 2014to participate in the Initiative. In 2015, it became a founding member of the AIIB. In the future, I think we need to explore two aspects. First, we must strengthen mutual recognition of standards, which will further reduce the barriers to investment. China has released the “China's Consumer Product Quality Improvement Plan 2016-2020”. This plan clearly states that by 2020, China's consumer goods will account for 95% of internationalization. Second, the facilitation of investment, the Communist Party of China’s report on the 19th National Congress clearly stated that in the future, we must implement the management method of pre-entry national treatment with negative list for all foreign capital. This new management method means the entry barrier for foreign investment in the future will be lower and the management will be more international. Therefore, I believe that our two countries still have a lot to discuss about the facilitation of investment. China's going to explore a higher level of openness in the future. What level is the higher level? This requires the implementation of economic and trade practices in the two countries and a clearer institutional arrangement at the policy level. This is very beneficial for promoting investment growth between China and South Korea.
Finally, the people-to-people exchange. Whether Korean styles or Han styles, it is very beneficial to the public network between China and South Korea. Korean film and television are very promising in the Chinese market and very popular among Chinese people. At the same time, there are many common areas in culture between China and South Korea.
Based on the above five connectivity, I believe that the prospects for future cooperation between China and South Korea are still very broad. I also look forward to more win-win outcomes of China-South Korea Free Trade Agreement on the basis of the BRI. Thank you.
Wan Zhe: Thank you, Ms. Zhao Ping for your wonderful speech. The cooperation between China and South Korea in economics and trade or finance has both background and prospects. So it should be said that very good cooperation in the future is expected. Next, let's welcome Mr. Choi Suhyun, former Chairman of the Korea Financial Supervisory Committee, please.
Choi Suhyun: The Chinese guests just gave us three opinions, economic cooperation, financial cooperation and other aspects, and I think there are still many things in common. In the fields of economic cooperation, trade and investment, finance, etc., which are known to all, the broad development, especially in the fields of politics, diplomacy, administration, society, culture, etc., together with this constitutes an important part of the country. Therefore, it is very easy to be affected by the relationship between the two countries. In today's era of globalization, the economy is, in many cases, the most normal in the framework of economic logic and financial logic. So today I want to discuss this issue with you.
There are cooperation between the state and local governments in the form of economic cooperation, as well as special economic zones, such as the Shanghai Special Economic Zone, the Nansha Special Economic Zone, etc., to designate a specific special zone to strengthen cooperation. We have several models, I want to In this regard, there are many advanced experiences in the world, and we can all learn from them. Therefore, I hope that our Nansha can succeed, and we hope to strengthen cooperation with South Korea with Nansha. It is necessary to focus on trade and investment, but it is still relatively lacking in the financial sector, mainly because of the financial cooperation between the two countries. This is the five largest banks in South Korea have come to China, China's five major banks have come to South Korea, and major Korean banks have also come to China. So in the future, we still have a lot of cooperation prospects in the financial field.
South Korea and China have considerable commonality in the financial sector. Finance plays a major role in supporting the real economy. Therefore, it is its main purpose to support the real economy through financial support and ensure global competitiveness. Household debt and corporate liabilities, liabilities in the operation of the entire country, it will become a burden. Therefore, in order to alleviate such a burden, we are also thinking about various methods. I also hope that the cooperation between South Korea and China will continue in this regard.
China's GDP is the second in the world. We are the tenth in the world. Today is an era of crisis-ridden risks. The two economies should have more. We must not only focus on our own interests, but also ensure that we strive to protect and safeguard the interests of other countries in the international arena. We have such responsibilities. In the future, we can strengthen cooperation in the prevention of financial crisis. For example, in terms of depositor insurance, we can continue to strengthen cooperation.
Another point is that in financial cooperation and economic cooperation, the most important one is hardware. For example, it is also important to make a certain place a key open area and then do some key openness as an international standard to open a policy. Some policies, such as the Chinese government, opening up to the outside world, deepening financial reforms, and building the Davos system, will play a greater role in global financial cooperation. Financial cooperation must be based on mutual trust between each other. Therefore, it is necessary to strengthen mutual trust, promote financial cooperation in a long-term and stable manner, and make financial cooperation a solid foundation for economic development.
I also mentioned the problems of financial technology and the RMB and capital markets. I think it is also a common concern of our two countries. To emphasize again, the most important thing in financial cooperation is mutual respect and mutual trust. Therefore, in the future, our financial cooperation can develop on a long-term basis and must be based on mutual trust. I hope that this kind of dialogue can last for a long time. Thank you!
Wan Zhe: Many thanks to Chairman Choi Suhyun for his wonderful speech. The country's economic development is not unique. It needs to be mutually supportive. China and South Korea should jointly promote such progress and improvement in global financial cooperation and governance on the basis of cooperation between the two countries. Next, Mr. Choi Gwangseok, Vice President of KCN Investment Corporation, will share his opinions, please.
Choi GwangseokChoi Gwangseok: Hello everyone!
I also mentioned the problems of financial technology and the RMB and capital markets. I think it is also a common concern of our two countries. To emphasize again, the most important thing in financial cooperation is mutual respect and mutual trust. Therefore, in the future, our financial cooperation can develop on a long-term basis and must be based on mutual trust. I hope that this kind of dialogue can last for a long time. Thank you!
I will share with you the status of private equity funds in Korea and the prospects of cooperation between China and South Korea in private equity. First, let me introduce the Korean private equity fund system. The private equity fund system in Korea includes professional investment and business participation, and venture capital. field. A private equity fund like a professional investment private equity investment in real estate investment, stocks, bonds, and SOC alternative investments. This is a must to register, its capital is 2 billion, there are more than 3 professional operators, business participation is mainly required capital is more than 100 million, professional fund operators are more than 2, but also To register. For example, venture capital funds mainly pay for capital increase for start-ups and venture companies. The new share subscription is their main business. The capital registration capital must be more than 5 billion, and more than 2 professionals must obtain government permission. For example, if China's private equity funds want to enter China, because South Korea has changed from a licensing system to a registration system, this threshold has been reduced a lot and there is a lot of room for cooperation.
Next, I will share with you about the Korean private equity market. Let’s take a look at the professional investment fund. The total net assets of South Korea’s funds are 462 trillion, up 11.8% year-on-year. The main reason is because Private equity funds have had a big development. Among the total assets of the funds, public funds were 212 trillion, a decrease of 0.7%. On the contrary, private funds increased by 25.2% year-on-year to 250 trillion. In the last five years, the average annual growth rate, private equity funds 18%, The public fund is 3%. We can see that it is much higher than the original average growth rate of 10%. It can be seen that in the investment financial market in Korea, private equity funds are extremely active, especially real estate and SOC. The net assets of alternative investment funds reached 94.8% trillion won, and the investment in alternatives has increased substantially. Especially in the total amount of overseas investment, overseas real estate funds accounted for 46.8% and SOC accounted for 27.9%. A big improvement, we can see that the proportion of South Korea's investment in overseas real estate and overseas SOC projects is very large in the future. It can be seen that China and South Korea have a lot of cooperation space in the field of alternative investment.
The following is to talk about the market operation status of the operating-involved private equity fund. As of the end of last year, there are 383 privately-owned private equity funds. The agreed capital of these private equity funds is 62.2 trillion, of which the amount has been reached 366,000. Billion, by the end of this year, private equity funds amounted to 610,000 won. In 2015, the Korean government transferred the licensing system for the establishment of private equity funds to the registration system, which greatly improved the market for Korean private equity funds. At the end of last year, there were 190 private equity fund operating companies, and this operating company has a new trend next year. In particular, the average annual private equity fund investment execution in the past three years is 9 trillion yuan. This year we learned that Daewoo Construction is carrying out a large-scale transaction of 2 trillion yuan. I believe that this year's investment execution will be greatly improved. In particular, we have 230 countries and 86.5% are concentrated in domestic companies.
However, as the operating capacity of some fund operating companies has been verified, the proportion of private equity funds investing abroad has increased from 11.6% in 2015, a slight increase to 13.5%. I think that in the future, China and South Korea also have a lot of room for development in the field of private equity funds.
Second, I want to talk about the situation of venture capital private equity fund market. At the end of last year, we reached 610 venture capital cooperatives. The entire fund pool was built and invested in 3022 enterprises. The main investment method of the fund is the mother fund operated by Korean SMEs. For venture capital, they invested at up to 24.5%, financial institutions contributed 21.8%, and private enterprises accounted for 14.4%. At the end of last year, the number of companies that had agreed to make the amount of investment was 294, and the total investment amounted to 4.9 trillion. Last year, there were 120 venture capital operation companies in Korea, and 13 new venture capital companies in 2016. In particular, South Korea’s parent fund, South Korea’s venture capital has established overseas investment funds with overseas venture capital firms and 14 venture capital companies, amounting to 1.33 trillion yuan, of which Korean venture capital investment was 200 billion yuan, especially this year. 112 billion yuan should cooperate with overseas venture capital companies.
Finally, I want to share with you the prospects of the Korean private equity market and a future cooperation between China and South Korea. We can learn from some of the above data that South Korea is more active than public funds and private equity funds, so we feel that there will be more and more opportunities to attract global investment in private equity funds. In particular, South Korea’s interest rate tone will continue to increase as the US federal interest rate continues to increase. Therefore, more and more people will tend to invest in medium-income and dangerous alternatives. The world economy such as China’s “One Belt, One Road” and the US’s overall economic recovery will become more active, and the investment in real estate, physical assets and SOC will be more The bigger it is. For physical assets such as real estate and overseas infrastructure, we believe that the financial institutions of China and South Korea should continue to pay attention and it is necessary to cooperate in these areas. Especially when the Chinese government implements the “One Belt, One Road” policy, we feel that South Korea’s alternative investment funds and some financial institutions in China can also establish joint funds, especially in terms of investment methods, in addition to the original private equity fund investment. We believe that private equity investment in private equity should also be included in this approach, because we can solve the problem of recycling after investment.
We know that China is pursuing "Made in China 2025", so we feel that China and South Korea have established funds to explore potential companies that can become world-class companies. In addition, the South Korean government is operating a venture capital investment in Korea, in order to support Korean companies to go global, such a strategy and some overseas venture capital funds to establish a joint fund, in 2017 has already announced that it will invest 112 billion won. We feel that China and South Korea can seek cooperation in this regard. We believe that in the coming period, the global will maintain this low interest rate tone, the rollout of China's “Belt and Road” cause and the recovery of the US economy. If we can continue, we feel that China and South Korea can address this alternative investment. The market is looking for some more cooperation. Thank you!
Wan Zhe: I am very grateful to Choi Gwangseok for his wonderful speech. In fact, we can also see that there are already many private equity funds, especially the private equity funds in the United States that have entered China in the past, and many companies have joined in the stage of entrepreneurship. When Renren.com was listed on the New York Stock Exchange, Softbank made a profit of 6 times on the same day. When it was online, the Tiger Fund earned more than 30 times in 6 years. We now have a lot of companies in the beginning or the introduction of the second part of the stage, the prospects for future development or cooperation in this area must be very broad, thank you again. Next, we have Mr. Jeong Yeonku, Director of Shinhan Investment Cooperation, China, to share his views with you.
Jeong Yeonku: I am very happy to meet you. It is a great honor to be able to express my opinions here. I would like to talk about my ideas on specific points. Most of what I am talking about today is a problem in the actual implementation process.
First of all, I am very grateful to China for entering a basket of currencies. After this, I believe that China will play more and more role in the securities market. You can take a look at the table in front of us. Foreigners from 1992 to 2004, foreign investors in the net sale of shares in South Korea, and South Korea's per capita income from 8,000 US dollars to 15,000 US dollars is the same period. And we grew from an era of savings to an era of investment, and the thickness of our middle class will become thicker and thicker. After that, many foreign companies returned to South Korea to acquire shares. South Korea’s comprehensive index, the Korean Composite Index increased by 103%. In the process, Chinese people, everyone is very familiar with, like Samsung Electronics, Pacific Cosmetics, Southwest Automotive, etc. And so on, compared with the Korean Composite Index in the same period, it is higher and 30 times higher. So this is actually a very inevitable phenomenon that occurs at every stage of development.
At present, China's per capita GDP is about 8,000 US dollars. It can be said that from the perspective of development, we believe that China's stock market will have a very large growth. Therefore, 30% of our current customers are continuously investing in China's stock market. After the evaluation of income and income in the past year, we have achieved more than 4 times the profit compared with the Shanghai Stock Exchange Index. So we will continue to work hard in this regard.
I believe that if such a concept can be packaged into commodities and pushed out by financial companies in China and South Korea, I believe that it can meet the needs of investors from both countries. At the same time, this aspect is very simple, we can achieve it immediately. A very viable option.
This is related content. Mr. Liu Shaobo just mentioned the cooperation between China and South Korea in the environment. Climate change is a very promising field in which China and South Korea can cooperate, because economic growth is often accompanied by environmental sacrifices. Since 2000, South Korea has been emphasizing green growth and green development. The virtuous circle of economic environment is a theme we are pursuing. We must let the environment become our driving force for development, let it become the driving force of our economic development, and push us to continue. development of. After 2000, the Korean government's political power has continued. No matter which government has focused on the environment, the results have changed dramatically. You can see that this form is more complicated, but this is An industry-related form issued by the Bank of Korea and the Bank of Korea every year, which includes the contents of all Korean industries.
In the 2014 form, this data is the latest data. As you can see, I have marked some yellow, environmental industries related to climate change. The data in this industry is developed for the purpose of reducing emissions and developing these industries. The proportion of Korean industry before 2000 was completely meaningless, but in 2014, this proportion increased to 27.6% of imports, 39.6% of exports, 16.9% of private investment, and 12.3% of private consumption. The proportion of Korean industry is growing. Therefore, climate change is becoming more and more important in the Korean industry, and it is also a very important area. Therefore, in order to catch up with such a pace, many companies are catering to global trends and have been making changes and changes.
Most of the IB alternative investments that we have in South Korea are now in this area, and China is very active in terms of air quality, emissions reduction, etc., as far as I know. Therefore, in terms of investment in China's environmental industry, if the financial institutions of the two countries issue some docking funds, I believe that the durability of this product can be ensured first, and at the same time, the needs of investment personnel of the two countries can be met. China's financial institutions have invested in transactions, and our Korean financial institutions have also contributed capital to provide some Korean technology in the field of environmental protection. I believe that such a docking method can meet the needs of both countries.
There are a lot of confusions about Korean financial assets. Financial assets are inherently profitable, but they are saturated in many areas of Korea. Therefore, if the debt demand generated by financial assets is only operated by our domestic Korean capital, In fact, it is difficult to meet its needs. Therefore, we set up investment centers in Hong Kong, and work together in China and other countries to make such cooperation, so that our investment can be more efficient, we are making these efforts. So for transactions and customers, we can provide good service at all levels.
In February, South Korea’s settlement and China’s Industrial and Commercial Bank signed the “Securities Swap Agreement”. After this agreement, investors from both countries can easily realize investment, and there is a growing lack of differentiation with domestic investment. Such a mechanism can make our financial system more flexible, allowing it to replace or eliminate the inequality of domestic and foreign investment environments. Because this kind of price difference or interest and efficiency between our two countries can exist. Therefore, I hope that the cooperation between the financial institutions of our two countries will continue to flourish. Thank you!
Wan Zhe: I am very grateful to Director Jeong Yeonku for his wonderful speech. I just mentioned that in terms of green finance, China is now the world's largest green bond market. I think China and South Korea can work together to improve the comparability and consistency of green standards. Make green finance a more important part of international cooperation.
Today, we have actually a very successful forum. In fact, China and South Korea have a long history of relations. Whether it is Hanfeng in Korea or Korean Wave in China, it shows our relationship is inseparable. In the future, we still have to strengthen mutual trust, strengthen cooperation, and achieve win-win cooperation. This is the golden avenue that we should walk together in the future. Thank you all.