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Guo Shuqing: Boosting Multi-level, Multi-product Capital Market System
“China's financial industry has two problems, namely, difficult financing due to too many enterprises as well as investment difficulties in spite of much capital,” said Guo Shuqing, Chairman of China Securities Regulatory Commission (CSRC), at the Lujiazui Forum 2012 on June 29. Guo also held that the financial service industry system needed to be perfected, while the direct finance had natural advantages in driving the adjustment to and upgrading of the industrial structure.
Guo held that the overreliance on the indirect financing system and the low proportion of direct financing highlighted the unbalanced internal structure of the financial industry. Besides, there were problems about the unbalanced structure such as the underdeveloped bonds market, the single-level equity financing market, and the underdeveloped futures and derivatives in the capital market. Our derivatives market is underdeveloped compared with the mature markets characterized by various derivative tools such as futures, options and swaps, large trading volumes, and tight correlations with economic development. Moreover, there exists the structural imbalance in the financial services for the real economy. In the financial system dominated by commercial banks, large enterprises and government-related ones occupy more financial resources, while SMEs and innovative enterprises only get limited services.
Guo also said that to solve these issues called for the reform of financial system and the construction of the capital market. It is a must to accelerate the development of multi-level and multi-product capital market system. It is also needed to develop the bonds market, promote the over-the-counter market under unified supervision, and standardize the development of regional equity trading markets. With an aim of enhancing the coverage and tolerance of the capital market, it is a necessity to stably develop the futures and derivatives markets and build the multi-level capital market system. Besides, it is also a requirement to strengthen innovation of products, do a good job in the trial of SMEs’ private placement bonds, and launch oil futures and treasury bond futures, in a bid to broaden channels for residents’ wealth management.
Source: Futures Daily
