ZCZC
BCN-09
STOCKS-CHINA-INVESTMENT-FOREIGN
China to widen foreign access to A-shares
SHANGHAI, Aug 16, 2018 (BSS/AFP) – China’s securities regulator said it
will allow individual foreign investors working in the country to buy and
sell yuan-dominated Chinese A-shares, the latest incremental step by Beijing
to widen access to its long-cloistered equities markets.
The change would go into effect on September 15 and also applies to foreign
employees of Chinese-listed companies who are working for those firms outside
the country, the China Securities Regulatory Commission (CSRC) said in a
statement issued late Wednesday.
Previously, foreign access to Chinese stocks has been largely through B-
shares, which are denominated in foreign currencies and geared toward
international investors, while only qualified foreign institutional investors
could buy into the larger pool of A-shares.
But a number of steps in recent years have widened the door, including the
establishment of programmes under which international investors on Hong
Kong’s more open stock market can buy some shares on China’s exchanges in
Shanghai and Shenzhen, and vice-versa.
A similar connection between London’s exchange and the mainland Chinese
bourses also has been proposed.
In June more than 200 Chinese companies debuted on the emerging market
index compiled by MSCI, which is expected to lead to billions of dollars of
new investment in those Chinese shares by global funds that match their
portfolios with MSCI’s indices.
The CSRC said the move was being taken to “deepen the opening up of the
capital market, enrich the investment sources in the capital market, broaden
channels for capital access, and optimise the structure of the capital
market.”
China has taken its liberalisation steps partly due to foreign pressure,
partly to help promote the maturation of its often volatile markets, and
partly to increase the global profile of its yuan currency.
China has made additional liberalisation pledges since the US
administration of President Donald Trump began pressuring Beijing to open its
markets.
The China-US trade confrontation has pressured Chinese stocks this year,
pushing the Shanghai index to its lowest levels in around two and a half
years.
BSS/AFP/MR/ 1140 hrs