China to speed up capital market development

China is set to speed up the establishment of a multi-layered capital market. This was emphasized by Chinese Premier Wen Jiabao's annual government work report delivered yesterday to China's top legislature.

On the sideline of the first session of the 12th NPC meeting, CCTV reporter Yin Hang has spoken with Gui Min-Jie, head of the Shanghai Stock Exchange. Gui said the stock exchange will improve its management and transparency, in order to attract more investors with better services and products.

After years of disappointing bearish performance, investors in the Chinese stock market are expecting urgent reforms and efficient changes.

Chinese Premier Wen Jiabao stressed in his annual work report delivered yesterday that China is to speed up the development and reform of its capital market. Gui Minjie, Chairman of the Shanghai Stock Exchange, echoing Premier's report, says the exchange is to make more innovation pushing forward the development in sectors such as the blue-chip stocks issuance, and de-listing mechanisms.

Gui Minjie, chairman of Shanghai Stock Exchange, said, "The report provides guidance for the future development of China's stock markets. It also gives us more pressures. It's also a sign that there are a lot that we can do in better serving China's real economic growth and achieve the markets' function of resources allocation."

In recent years, China's stock markets have lagged other major indicies and generally been quite sluggish. Investors, or even deputies from the National People's Congress are complaining that the stock market can not bring wealth to its investors.

But the Chinese government has made efforts to restore confidence, in part by trying to crack down on insider trading, nudge up its transparency, and improve its trading regulations.

Guo Shuqing, head of China Securities Regulatory Commission, is vowing to reduce the role that government plays in approving the initial public offerings and shifting more power to auditors and investment banks. He is aiming to foster a more transparent market where various players take on greater responsibilities for actions of their own.

China's main bourse also says it will make more efforts to increase the competitiveness of the market.

Gui Minjie said, "We will push forward the development of more trans-border Exchange Traded Funds products. We believe it's an crucial step to opening up China's capital market. And we're also considering rolling out more financial products to our investors. And currently China's market trading method is single and simple. We will make more innovations to improve that."

Gui also says the Shanghai Stock Exchange is to attract more companies into its blue-chip stock market. The exchange will create a better environment for market players, in a bid to make market resources more accessible for companies.

The exchange will also improve China's de-listing mechanism, making their supervision more efficient and transparent.