Cross-strait mar­ket co­op­er­a­tion should pro­ceed slowly: FSC

The China Post - - TAIWAN BUSINESS -

Tseng Ming-chung, chair­man of Tai­wan’s Fi­nan­cial Su­per­vi­sory Com­mis­sion (FSC), said Wed­nes­day that co­op­er­a­tion in the cap­i­tal mar­kets across the Tai­wan Strait should be im­ple­mented in a grad­ual man­ner.

Tseng made the com­ments af­ter the lo­cal me­dia cited Jiang Yang, vice chair­man of the China Se­cu­ri­ties Reg­u­la­tory Com­mis­sion (CSRC), as re­port­ing that the CSRC is study­ing the fea­si­bil­ity of a Taipei-Shang­hai stock trad­ing mech­a­nism, mod­eled on the “Shang­hai-Hong Kong Stock Connect” launched last year.

The Shang­hai-Hong Kong Stock Connect trad­ing plat­form al­lows for­eign in­vestors to trade Chi­nese A-shares in Hong Kong, and in­vestors in Shang­hai to trade Hong Kong shares in China.

Com­pa­nies listed on China’s ex­changes of­fer two classes of shares: A shares de­nom­i­nated in Chi­nese yuan for Chi­nese in­vestors to trade and B shares de­nom­i­nated in U.S. dol­lars or Hong Kong dol­lars for for­eign in­vestors to trade.

Tseng said that in­ter­na­tion­al­iza­tion has be­come an ir­re­versible trend in the devel­op­ment of Tai­wan’s cap­i­tal mar­ket and the FSC is determined to boost its global visibility.

How­ever, a Taipei-Shang­hai trad­ing mech­a­nism is a com­pli­cated is­sue which will re­quire in­volve­ment by many in­sti­tu­tions to make it hap­pen, while Tai­wan it­self should reach a con­sen­sus on whether or how to im­ple­ment it, Tseng said.

Tseng said that Tai­wan needs more time to as­sess such a cross-bor­der stock trad­ing plat­form but he said that the two stock ex­changes in Taipei and Shang­hai could start with less com­pli­cated ex­changes, such as cross-li­cens­ing stock in­dexes and mar­ket in­for­ma­tion shar­ing as the first stage of co­op­er­a­tion.

He said he be­lieves that us­ing a step-bystep ap­proach to pur­sue cross strait cap­i­tal mar­ket co­op­er­a­tion will strengthen mu­tual un­der­stand­ing be­tween each side and pave the path for fur­ther ex­changes in the fu­ture.

Ac­cord­ing to lo­cal me­dia re­ports, Jiang said in a cross-strait eco­nomic fo­rum held in Taipei that the CSRC sup­ports any co­op­er­a­tion be­tween the stock ex­changes in Taipei and Shang­hai.

Jiang ad­mit­ted in the re­port that whether a Taipei-Shang­hai stock ex­change will be im­ple­mented is up to the will of au­thor­i­ties in Tai­wan to open the door to such mar­ket ex­changes.

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