China has accumulated enormous financial assets during its development over the past three decades. Its deposits in the banking system have been estimated at more than US$10 trillion, an amount almost equivalent to the annual GDP of the United States. The new leadership can rely on this capital to create new wealth. To do so means the new administration under Xi Jinping would need to improve the market mechanisms to stimulate financial transactions and circulate wealth. Speeding up the internationalization of the renminbi will also be a key task. If the government is able to open up the capital account during the next five years, this will lay down a solid foundation for the free conversion of the renminbi.
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