by YANG Zhijin, HE Liuying
Speaking on the sidelines of the Lujiazui Forum in Shanghai this week, Nikhil Rathi, chief executive of the UK Financial Conduct Authority, said the deepening financial cooperation between China and the UK is creating more space for collaboration in areas such as green finance, fintech, and asset management.
Rathi pointed to the success of the Shanghai-London Stock Connect, launched in 2019, as a key milestone. The mechanism enables eligible listed companies in both markets to issue depository receipts and trade on each other's exchanges, supporting cross-border capital flow and integration between global financial hubs. While the mechanism remains in place, new listings have reportedly slowed in recent years amid geopolitical tensions.
During this year's Lujiazui Forum, the People's Bank of China unveiled eight new policy measures aimed at boosting Shanghai's financial openness. These include a pilot program in the Lingang Special Area to reform offshore trade finance and develop a Shanghai FTZ offshore debt pilot—initiatives that align with London’s strengths in cross-border financial services.
Rathi also emphasized the City of London's role in renminbi internationalization. According to the latest London RMB Business Biannual Report, jointly released by the City of London Corporation and the People's Bank of China's representative office in Europe, London continued to expand its RMB business in foreign exchange, credit, clearing, and cross-border settlement. UK-based Chinese banks and existing financial infrastructure make London a leading RMB trading and payment center outside China.
Looking ahead, he identified wealth management as an area of growing relevance. With China's aging population expected to exceed 400 million people aged 60 and above by 2035, demand for retirement-focused financial services is rising. The UK's expertise in investment management could support China in building out long-term retirement solutions.
On the fast-evolving AI front, Rathi said the UK remains open to innovation but stressed the need for responsible oversight. The FCA, which oversees the conduct of financial firms and markets while promoting competition and consumer protection, follows an outcome-based regulatory approach. This emphasizes risk management while allowing firms flexibility in how they meet compliance targets. China and the UK have already committed to working together on global AI governance, including advancing the UN's Global Digital Compact agreed during May's bilateral AI dialogue.
Rathi also discussed stablecoin regulation, as the UK prepares a framework requiring all circulating stablecoins to be fully backed 1:1 by low-risk, liquid assets held by independent custodians. This approach mirrors recent regulations in Hong Kong, aimed at ensuring transparency and financial stability in digital currency markets.