Photo taken on Nov.18, 2020 shows a view of the city of Guangzhou, South China's Guangdong Province. The 10th Guangzhou International Light Festival is lighting the city from Nov. 18 to 29. As one of the world's top lighting events, the Light Festival has witnessed the development of Guangzhou city. (Photo/China News Service)

A futures exchange is to be set up in Guangzhou, South China's Guangdong Province, a move to improve the comprehensiveness of China's financial system and enhance the role of finance in serving real economy in Guangdong-Hong Kong-Macao Greater Bay Area (Greater Bay Area), Chinese experts said.

The Guangzhou Futures Exchange has been approved by the State Council and is expected to go into operation within this year, said Chen Zhiying, executive deputy mayor of Guangzhou at the International Finance Forum 2020 Annual Meeting (F20 Summit) on Saturday.

The establishment of the Guangzhou Futures Exchange will not only enhance the pricing power of financial and bulk commodities in the Greater Bay Area but also enhance the role of finance in serving the real economy, experts said.

In terms of financial functions, the establishment of a new futures exchange can hedge risks and lock in the prices of raw materials and commodities, Lin Jiang, a professor of economics at Lingnan University College of Sun Yat-sen University.

"The Pearl River Delta is a manufacturing center. The new futures exchange can help companies in the real economy avoid risks and reduce the impact of raw material market price fluctuations," Lin said.

The futures exchange is expected to fill in the vacancy of commodity futures exchanges in South China, serving as a complementary to the Shenzhen stock exchange and Hong Kong Futures Exchange, experts said.

"The Guangzhou Futures Exchange which mainly deals with commodity futures, is expected to cooperate with the spot transactions in Hong Kong and Shenzhen, to make the function of financial transactions in the Greater Bay Area more complete," he said.

In terms of promoting the financial interconnection of the Greater Bay Area, Guangzhou has formulated a multitude of plans, including promoting cross-border trade and investment in the Greater Bay Area, enhancing cross-border exchange of domestic and foreign currencies and building Greater Bay Area asset management center.

The GDP of Guangzhou city in the first three quarters increased 1 percent year-on-year. The growth rate was 7.8 and 3.7 percent higher than that in the first quarter and the first half of the year, indicating the resilience and vitality of the city's economic operation.

Chen said that the city will continue implement high-quality development in the financial sector during the 14th Five-Year Plan 2021-2025 period, with the focus on serving the real economy, deepening financial reforms, and preventing and controlling financial risks so as to develop Guangzhou as the core engine of Greater Bay Area.