China’s President Xi Jinping speaks during a bilateral meeting with U.S. President Donald Trump at Trump’s Mar-a-Lago estate in Palm Beach, Florida, April 7, 2017.
China’s President Xi Jinping on Thursday said the country would set up a stock exchange in its capital, Beijing, to serve small and medium-sized enterprises (SMEs).
Mainland China’s two major stock exchanges are in the financial hub of Shanghai and in the southern city of Shenzhen, on the mainland’s border with Hong Kong.
In a video address at the opening of the China International Fair for Trade in Services (CIFTIS), Xi said China would continue to support the innovation-driven development of SMEs.
This would be done “by deepening the reform of the New Third Board and setting up the Beijing stock exchange as the primary platform serving innovation-oriented SMEs,” he added.
Reuters reported in March that China was considering establishing a bourse to attract overseas-listed companies and bolster the global status of its onshore share markets, citing sources with knowledge of the matter.
The sources said then that upgrading Beijing’s existing equity exchange for small and mid-sized firms, known as the New Third Board, was among the options being discussed.
China’s securities regulator said setting up a Beijing stock exchange would help deepen financial supply-side structural reforms and improve capital market systems.
In a statement issued shortly after Xi’s remarks, the China Securities Regulatory Commission (CSRC) said its leadership was “excited” at the prospect, would study the president’s proposal in depth and resolutely implement it. “Small and medium-sized enterprises can do great things,” the CSRC added.
In other comments in his speech to mark the opening of CIFTIS, a trade fair in Beijing, Xi said China would “create more possibilities for cooperation by scaling up support for the growth of the services sector in Belt and Road countries.”
The Belt and Road Initiative is Xi’s signature trade and infrastructure scheme.
China will support Beijing and other localities in “piloting the alignment of domestic rules with the ones in high-standard international free trade agreements, and in building demonstration zones of digital trade,” the president added.