China’s Legal Reponses to the Global Financial Crisis : From Domestic Reform to International Engagement

This article aims to identify and examine the key issues impacting China’s financial regulation in light of the recent global financial crisis (GFC). The investigation generates a number of important findings. First, the effects of the GFC on China’s financial system have been relatively mild. However, this is largely owing to its lack of financial sophistication and isolation from the global markets. Second, China’s domestic responses to the GFC have been quite effective, but at the same time it has serious side-effects for China’s financial regulation. Third, China is well-positioned to embrace new international standards such as those contained in the Basel III Accord. This article sets forth suggestions for reform of China’s domestic financial regulatory structure, and evaluates the steps China has taken towards playing a bigger role in the future development of international financial regulation