Conditions ripe to launch Shanghai's international board

13:21, June 09, 2011      

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The four major necessary conditions for the launch of the international board on the Shanghai Stock Exchange have "basically" been met, said Tu Guangshao, vice mayor of Shanghai.

According to a national strategy, Shanghai will be built into an international financial center that corresponds to China's economic strength and the international status of the Renminbi.

Tu noted that an international financial center means increasingly internationalized financial market and business.

An international financial center requires significant global influence, he said.

Regarding the launch time of the international board, which is the most closely watched topic, Tu said that conditions, including basic conditions, the market, accounting and technical preparations, are required.

In terms of basic conditions, the launch of international board is closely related to market development, financial openness and the degree of economic internationalization.

Tu cited two examples for the conditions of the market itself. The first is regulation. He said a regulation system needs to be built for foreign companies to list on Shanghai's international board. Such a system requires complete and detailed regulations to help foreign companies adapt to domestic rules.

As to accounting standards, Tu said that foreign companies have different accounting systems. Although the Shanghai Stock Exchange has adopted more international accounting standards, there are still differences.

He also talked about technical preparations and supervision. As most companies on the international board are outside China, how to supervise them in case of problems is a concern. Agreements must be signed between domestic and overseas supervision departments in order to help supervise the board.

"The aforementioned preparations are basically mature and the international board will be launched steadily," he concluded.

By People's Daily Online
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