China to regulate the regional equity markets to raise small and medium-sized businesses financing

Almaty. January 12. Silkroadnews – China’s State Council has approved a series of measures aimed to enhance the regulation of the regional stock markets to boost financing of small and medium enterprises, “Xinhua” agency writes.

“China will promote the healthy development of regional equity markets to allow them play "positive roles" in serving SMEs in the areas”, the publication says.

According to the statement released after the State Council’s meeting, the cross-regional operations of the equity markets will be adjusted and regulated, and such financing platforms in the territory of one region will be controlled by one single institution.

A qualified investors mechanism will be applied to ensure compliance with the requirements for trading in the equity market. It requires participants to have relatively strong resistance to certain risks and certain scale of the financial assets.

The meeting also clarified regulations on allocation of responsibility between the provincial authorities and the securities regulator to jointly protect the interests of investors.

Regional equity markets are an important part of China’s capital market; they are mainly focused on providing financing for non-public joint stock companies through the stocks turnover in the regions.

At present there are more than 30 regional equity markets operating in China and located throughout the country.