Xi says China will establish a Beijing stock exchange for SMEs

BEIJING, Sept. 2 (Reuters) – Chinese President Xi Jinping said on Thursday that the country would set up a stock exchange in its capital, Beijing, to serve small and medium-sized enterprises (SMEs).

The two main stock exchanges in mainland China are located in the financial center of Shanghai and the southern city of Shenzhen, on the mainland’s border with Hong Kong.

In a video aimed at the opening of China’s International Trade Service Fair (CIFTIS), Xi said China would continue to support innovation-driven SME development.

This would be done “by deepening the reform of the new third board and establishing the Beijing Stock Exchange as the main platform serving innovation-oriented SMEs,” he added.

Reuters reported in March that China was considering establishing a resource to attract foreign-listed companies and strengthen the global status of its land share markets, citing sources familiar with the matter. Read more

Sources said then that upgrading the existing equity exchange in Beijing for small and medium-sized enterprises, known as the New Third Board, was one of the options being discussed.

The Chinese securities regulator said establishing a Beijing stock exchange would help deepen structural reforms on the financial supply side and improve capital market systems.

In a statement issued shortly after Xi’s statements, China’s Securities Regulatory Commission (CSRC) said its leadership was “excited” at the prospect, would study the president’s proposal in depth and implement it decisively.

“Small and medium businesses can do great things,” the CSRC added.

In other comments in his speech on the occasion of the opening of CIFTIS, a trade fair in Beijing, Xi said China “would create more possibilities for cooperation by increasing support for the growth of the services sector in the Belt and Road countries.”

The Belt and Road Initiative is Xi’s commercial and infrastructure scheme.

China will support Beijing and other localities to “pilot the alignment of national rules with those of high-level international free trade agreements and to build digital trade demonstration zones,” the president added.

Beijing Newsroom Reports; written by Tom Daly Edited by Raissa Kasolowsky, Barbara Lewis and Bernadette Baum

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