Commentary: Misreading China's regulations risks missing high-quality development opportunities

(Xinhua) 16:50, August 02, 2021

BEIJING, Aug. 2 (Xinhua) -- China's stock market has experienced some volatility recently, partly due to a certain degree of worry in the market regarding the recent regulatory policies for the platform economy and tutoring industry.

Some Western media outlets have resorted to sensation-mongering and painting the new regulations as the harbinger of state control over independent entities, a dismal market, and an exodus of foreign investors.

Misinterpreting the regulatory moves as a change in the wind is overblowing the normal governance of the rapidly changing industries and capital market. It is also misleading to investors who could have shared China's new development opportunities.

To understand the moves, the starting point should be examining the overall situation and trend of China's economic and social development.

The fundamentals of China's continued improvement in its economy have not changed, the pace of China's reform and opening-up remains firm, and the foundation for the development of China's capital market remains solid.

Upgrades to a series of regulatory policies and anti-monopoly penalties have sent clear signals to the market: The regulatory system is rapidly improving, and the development of China's platform economy must be on a sound and orderly track.

These regulatory policies are important measures to promote the standardized and healthy development of related industries. They are also vital to ensuring network data security and protecting people's livelihoods. They are not intended to restrict or suppress the industries but are beneficial to the long-term development of the world's second-largest economy as a whole.

At present, the global economy and global finance continue to face great uncertainties, and the internal and external environments that the development of China's economy and its capital market face are complex and severe. Responding to challenges through necessary change is what the circumstances require.

China has been sticking to the basic state policy of reform and opening-up for more than 40 years. In recent years, the pace of the opening-up of China's capital market has not slowed amid the COVID-19 pandemic -- it has accelerated.

The Political Bureau of the Communist Party of China Central Committee held a meeting on July 30 to study and analyze current economic circumstances and make plans for related work in the second half of 2021. The meeting urged efforts to improve the regulatory system for firms' overseas listings, the latest move reflecting China's firm determination to continue making good use of domestic and foreign resources and promoting its opening-up.

Overseas listings are an important part of the two-way opening-up of China's capital market, and they also reflect the requirements for high-quality development.

The China Securities Regulatory Commission, the country's top securities regulator, said on Sunday that the country has always been open to the listing choices of enterprises and has supported firms in choosing both domestic and international markets in accordance with laws and regulations.

The watchdog said it will further improve the transparency and predictability of policy measures. It also pledged more pragmatic measures for opening-up in the next stage to promote the high-quality development of China's capital market.

The outlook of the Chinese economy also promises more opportunities than risks, as China is determined and well-positioned to build itself into a great modern socialist country in all respects.

Since the beginning of this year, China's economy has continued to recover steadily with structural improvement. A large number of outstanding enterprises have flourished, and the number of high-quality investment targets in the capital market has continued to increase.

Misreading China's determination to pursue high-quality development and missing the opportunities along the way would be a mistake for any investor, any country. 

(Web editor: Xia Peiyao, Liang Jun)


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