FSDC Says China’s Capital Market Risk “Fully Dispersed,” Highlights Long-term Investment Value

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One of China’s top financial authorities has sought to assuage concerns over risk on the country’s capital markets.

The State Council’s Financial Stability and Development Committee (FSDC) convened a meeting on capital market reform and development on 20 December that was presided over by People’s Bank of China (PBOC) vice-governor and FSDC vice-chair Liu Guoqiang (刘国强).

The meeting concluded that “at present capital market risk has been quite effectively dispersed, and there is already long-term investment value…reform faces strong, beneficial opportunities.”

According to the meeting the next stage of capital market reform requires “greater focus on raising the quality of listed companies, strengthening listed company corporate governance, and a strict market withdrawal system.”

The meeting also called for “strengthening the information disclosure system, pragmatically and effectively protecting investors…firmly implementing market-based principles, and reducing administrative interference in transactions.”

“It is necessary to make reference to general international methods to actively nurture medium and long-term investors and clear out channels for various asset management products to enter capital markets.

“Regulatory departments must strengthen communications with the market, and actively head the voice of the market.”

 

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