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China to Open Securities Market Within Limits
Gao Xiqing, vice president of China Securities Regulatory Committee (CSRC), said China's securities market will open within certain limits to overseas securities companies and fund management companies as promised by the Chinese Government within 3 to 5 years after its entry into the WTO.
Consequent impacts will naturally be found on operations of the country's securities market and development of economy. Increased force may be exerted though no strong effect will be felt at first and this is as seen in fights to win customers, develop new security varieties, renovate hardware and software, and upgrade knowledge information. It is very important for a conscientious study into the trend of foreign securities markets in order to survive out of competition, Gao said at a meeting on October 17.
CSRC President Zhou Xiaochuan recently said that CSRC's task is to develop new institutional investors by special method. Gao explained that "special method" does not mean to encourage going in for risks or speculations but seek for a change of the situation in which few institutional investors were developed in the past years.
No securities companies should be allowed to make profit at the expense of medium and small investors' rights and interests and this should be given serious attention, Gao said. He pointed out that new security varieties must be created for China's securities market and that the influence of opening-oriented securities market can by no means be underestimated on securities companies and the country's financial setups in spite of the fact experiments are still being carried out.
In the view of Gao, all administrative methods should be excluded for a merger or reshuffle of securities companies. Decreased costs by securities companies are essential for survival out of world market competition.
Till August 2000, there are 1031 companies listed to a total worth of RMB$4 trillion yuan, investors over 50 million and a staff of over 130,000, in China's securities market.
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