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China to Make Use of Overseas Stock Markets: Official
China will seek to make more use of the New York, London, Tokyo, Singapore and Australian bourses while continuing to encourage listings on the Hong Kong stock market by its firms in 2001, top securities regulator Zhou Xiaochuan has said.
The country will speed up preparations for the establishment of joint venture securities firms and fund management firms, which will be larger, stronger, better run and internationally more competitive, the chairman of the China Securities Regulatory Commission (CSRC) said at a national working conference on securities and futures that ended Sunday.
According to Zhou, China will further reform its stock issuance system and gradually transfer more responsibilities to stock exchanges.
Preparations for the establishment of the second board market, including risk awareness education for investors, will be completed as soon as possible, Zhou said.
He pledged that the CSRC will beef up its inspection and law enforcement efforts and said that a crackdown on stock price manipulation will be launched soon.
To improve the quality of listed firms, he said the CSRC will raise the standard of information disclosure, promote the adoption of more international accounting principles, introduce independent board members in A share companies, further improve the corporate governance structure of listed firms, and make stipulations governing acquisitions of listed firms.
To encourage the development of institutional investors, the CSRC will continue with the experiment of open-ended funds and take measures to solve problems with fund management firms, he said.
The CSRC will allow securities firms providing distant services to customers using electronic networks, prolong stock trading time within the allowance of technologies, set up a central securities registration and settlement company as soon as possible, and gradually solve the issue of stocks owned by the state and legal persons that are not tradable at the moment, the chairman added.
Firms Raise Record Capital From Securities MarketChinese firms raised a record 324.9 billion yuan from the domestic and overseas securities market in 2000, the top regulator said.
By the end of 2000, 1,211 Chinese firms were listed on domestic or overseas stock exchanges, the chairman of the China Securities Regulatory Commission (CSRC) said at a national working conference on securities and futures ending Sunday.
Compared with the volatile overseas markets, China's securities market has been relatively stable amid fast expansion of the market size, he said.
Throughout the year, the Shanghai and Shenzhen stock exchanges recorded a trading volume of 6.08 trillion yuan, up 94 percent from the previous year.
By the end of 2000, the capitalization of the market stood at 4.8 trillion yuan, accounting for 57 percent of the gross domestic product (GDP).
securities investment funds made progress in 2000. The country now has 10 fund management companies, with four others being formed.
By the end of last year, the nation's 33 securities investment funds boasted total net assets worth of 84.6 billion yuan, up 35 percent from the previous year.
The regulators stepped up its supervision and law enforcement in 2000, partly due to the establishment of inspection bureaus in the CSRC's nine regional offices.
Since July 1999 when the Securities Law came into effect, the CSRC probed 236 cases and delivered sanctions to 88 institutions and 142 persons involved in 100 cases, collected 466 million yuan in fines and confiscated illegal income.
An advancement in 2000 was the abolishment of the much criticized quota system in initial public offerings (IPOs).
Instead, IPOs are now recommended by sponsors and reviewed by an expert committee before final approval by the CSRC.
Despite the obvious achievements, as an emerging market with a short history of 10 years, China's securities market still has many problems, Zhou said.
The quality of China's listed firms, intermediary institutions and fund management firms is yet to be improved; problems exist in the secondary market; and tougher punishment has to be delivered on various acts, he said.
All these problems have to be solved in the process of further regularizing the market, he added.
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