A Study Of Financial Corporation And Integration Among The Four Cross-Strait Regions

With the four cross-strait regions' economic and trading relationships becoming more and more intimate,so is their financial cooperation.For the cross-strait four regions,financial integration plays a critical role in the four regions' economic development and the reunification of the motherland.This thesis begins with qualitative analyses of the four regions' financial opening and cooperation situation.Then empirical techniques are used to present quantitative analyses on the degree of financial integration among the four regions.Finally some policy recommendations and prospect of the Greater China' financial integration are included in the last part of this thesis.The main findings are as follows:1.The signing of CEPA agreement has lifted constrains regarding mutual establishment of the financial institution,business interaction,and talent exchange. However,due to political and military limitations between cross-straits,both sides are confronted with tremendous hardships,either for Mainland to establish financial institutions in Taiwan,or for the Taiwan enterprises to get financing from mainland.2.By using econometric techniques like Cointegration,Impulse Response Function and Variance Decomposition techniques,we come up with the conclusion that stock markets in Mainland,HK SAR and Taiwan don't share long-term relationship,with little impact on each other,indicating a low co-movement relationship and minor financial integration among the three regions.3.Strategically,we recommend that bilateral financial cooperation could be done before a third region cooperation be introduced.Besides,with reference to EU experience,we proceed to the establishment of a Greater China financial coordination and management institution,a common monetary fund,then a unified currency,and finally we look forward to the realization of Greater China's financial integration.