The launch of China's first locally driven cross-border investment fund in Xiamen, Fujian province, earlier this year further signposted the East China province's efforts in opening up its economy to the outside world.

The Xiamen Maritime Silk Road Fund, established by the city government, has helped investment in the overseas holdings of Lixiang Auto, a Beijing-based electric vehicle startup with an aim of going global.

This latest effort follows a long line of development and reform in the history of Xiamen's financial industry.

The city was named a pilot city for reforming the financial system back in 1986. Since then it has pioneered financial reform, becoming one of the first cities to promote specialized banks, improve credit management and settlement methods, as well as foreign exchanges and debt management.

In 2010, the State Council approved Xiamen to become a cross-Straits regional financial service center because of its closeness to Taiwan. This enabled the city to attract financial institutes covering cross-Straits business, as well as banks, securities and insurers from Taiwan.

Getting its own free trade zone in 2015, Xiamen was able to make progress in interest rate liberalization, renminbi internationalization and capital account convertibility.

Entering the new era, the city has set the goal of attracting more investment, serving the real economy, controlling financial risk and deepening financial reforms with strengthened financial regulation and optimized services.

Attracting global business

Xiamen has opened up its financial market to the globe amid the country's reform and opening-up.

Branches of overseas banks, such as HSBC and Standard Chartered Bank, have settled in the city. The first Sino-foreign joint-venture bank of New China - Xiamen International Bank, was founded in Xiamen in 1985, a milestone for opening-up in the Chinese banking industry. By the end of 2018, the number of overseas banks in Xiamen had reached 15.

The newcomers have helped introduce advanced financial management and operation methods from overseas as well as enhanced financial exchanges between the city and the world, according to Xiamen Daily.

With the expansion of its international finance business, Xiamen's finance industry is able to provide financing and other support for local companies wanting to go global.

Cross-border trade in RMB settlement, which arrived in 2010, has covered cargo trade, service trade, inward and outward direct investment and cross-border two-way financing. It has helped lower currency conversion cost, streamline business processes and back international projects.

Cross-border RMB settlement grew from 24.64 billion yuan ($3.48) in 2011 to more than 106.24 billion yuan in 2018 with an average annual growth rate of 23.3 percent, data from the local government showed.

Green, technological goals

In recent years, the local government has focused on the development of green finance, financial technology, wealth finance and the gold industry, to better serve the real economy.

The Xiamen government is assisting green projects and green companies with fiscal subsidies, tax cuts and government guarantees. It is also encouraging financial institutions to back this segment. By 2018, the credit balance for environmental protection reached 17.31 billion yuan. The city plans to provide funds up to 12.07 million yuan in total to 12 banks for their contributions to green finance this year. It is also allocating pollution settlement subsidies up to 450,000 yuan to 66 companies in total.

In wealth finance, Xiamen has welcomed private investment management institutions to set up private equity funds in the city, including Sequoia Capital. By the end of August, it had 365 private fund management institutions, ranking among top 10 in China.

In terms of fintech, the city has numerous internet and new economy companies, such as Qudian, a leading provider of online small consumer credit in China. China Construction Bank has established a fintech branch in Xiamen to launch key technological products. The city also launched the country's first local financial off-site supervision system.

To develop the gold industry, the city has cooperated with Shanghai Gold Exchange to be able to have transaction warehouses and gold refineries. In August, the Straits gold and jewelry industrial park opened, which is expected to make Xiamen a first-level gold industry center in China.

Milestones and key events

Xiamen International Bank, the first Sino-foreign joint venture bank of New China, was founded in 1985.

The first clearing house and foreign exchange market of Fujian province were set up in Xiamen during 1986-89.

The cross-Straits regional financial service center was founded in Xiamen in 2010.

The first Straits finance forum was held in Xiamen in 2012 when the country's first cross-Straits renminbi settlement agencies' group was established.

Output value of the financial services industry of Xiamen surpassed 100 billion yuan ($14.13 billion) in 2015.

Xiamen cooperated with Shanghai Gold Exchange to build a gold business center in 2016 to target regions involved in the Belt and Road Initiative.

JMX Consumer Finance, the first joint venture in consumer finance between the Chinese mainland and Taiwan, was founded in 2018.