Investors struggle with ‘new normal’

President Xi Jinping has said on several occasions this year that the country needs to adapt to a "new normal" for the pace of economic growth.

By new normal, Xi means a new era for China's economy consisting of slower growth, painful restructuring and conflicting responses from the market in digesting government stimulus. It is a period in which economic problems are intertwined.

The stock markets are also experiencing a new normal, in which they struggle to adapt to government policy. It has been a fraught process. At times, investors have complained about excessive government regulations, only to later gripe about insufficient supervision.

The China Securities Regulatory Commission (CSRC) has been broadly relaxing restrictions, while at the same time strengthening supervision in specific areas of the market. For example, it has been revising requirements for IPOs and delisting from the stock markets. The goal is to give more choices and rights to investors.

The situation is inevitable during a period of economic transformation. To solve the problem, regulators should give investors more choices and rights so that investors and institutions can adapt to the new normal.