The setting up of a free trade zone in Shanghai marks a significant step in China's bid to play an active role in shaping global investment rules, officials and experts told a conference Wednesday.

"The free trade zone is part of the Chinese leadership's strategy to actively participate in formulating global investment rules," Wang Xinkui, chairman and president of Shanghai WTO Affairs Consultation Center, said in a keynote speech at a two-day conference on the multilateral trading system.

Wang, who helped draft policies for the FTZ, said the zone's three missions are to transform government functions, to further open the service sector and to facilitate trade and investment. These will help because individuals and enterprises need a high standard investment environment that cuts cost of investing and offers more room for innovation amid a changing business climate.

Wang said that to further facilitate investment, the financial system needs innovation to allow a free flow of capital.

Opened on September 29, the pilot FTZ has adopted a registration system along with a negative list to simplify investment procedures and allow foreign companies to invest as freely as domestic peers in certain sectors.

The People's Bank of China is working on plans about interest rate liberalization, free exchange of yuan and opening-up of capital accounts.