[Photo/VCG]

The Action Plan for Collaborative Development of Shanghai and Hong Kong International Financial Centers was signed on June 18, when the highly anticipated two-day Lujiazui Forum kicked off in Shanghai.

Made up of 38 detailed measures, the action plan aims to deepen cooperation between the two cities in terms of the connectivity of financial markets, innovation in cross-border financial services, green finance and technologies.

Specifically, Shanghai and Hong Kong will further optimize the Bond Connect program and the Swap Connect mechanism. Enhanced cross-border and offshore financial services will support companies' overseas expansion and align with the Belt and Road Initiative. The two cities aim to become global centers for renminbi asset allocation and risk management.

The two cities will also jointly explore cross-border clearance, a new area of cooperation. A new program linking gold products, trading, and application scenarios for cross-border renminbi payments is also expected. Financial institutions based in Shanghai may expand their reinsurance businesses via Hong Kong, according to the action plan.

Artificial intelligence and blockchain will be more widely used in asset management, insurance and settlement as the two cities deepen their cooperation. Both Shanghai and Hong Kong will aim to facilitate the development of technology companies with more supportive policies. Insurers will be encouraged to include new drugs and medical devices developed in both cities into their coverage range, promoting the development of the biomedicine industry.

With the new action plan, Hong Kong and Shanghai will pursue differentiated development while complementing each other's strengths. This cooperation is expected to enhance China's role and influence in the global financial system, according to officials at the signing ceremony.