Latest reforms promote long-term, healthy development of stock market

CHINA SECURITIES REGULATORY COMMISSION issued a statement on its website on Tuesday aimed at guiding more medium- and long-term funds into the market. Xinhua News Agency comments:

The commission has vowed to support listed companies to reorganize through repurchases and acquisitions, optimizing transaction supervision and reducing unnecessary intervention in trading. If carried out well, these measures are all pertinent to addressing the most pressing problems in the capital market.

The statement reflects the central authorities’ resolve to boost the healthy development of the capital market and the confidence in the Chinese economy.

The quality of listed companies is undoubtedly the cornerstone for the long-term stable development of the capital market, and the latest moves aim to improve the quality of listed companies by strengthening corporate governance, standardizing information disclosure and improving transparency.

They will also create a more efficient, convenient and fair trading environment by optimizing transaction supervision and clarifying market expectations. Putting an end to redundant supervision is a difficult but long-awaited reform.

With a clear direction of supervision, investors will have rules to follow and the market is expected to stabilize.

And by improving the quality of listed companies and clarifying the regulatory environment it will attract more insurance, social security funds and other professional institutional investors with a more mature investment philosophy and more sophisticated investment skills to pursue long-term stable returns.

The authorities are paying special attention to promoting the development of institutional investors and encouraging long-term investment as this would ensure the long-term steady development of China’s stock market.

The moves are thus an integral part of a series of reform measures adopted by the Communist Party of China Central Committee and the State Council to promote the development of the Chinese economy.