Wu Qing, chairman of the China Securities Regulatory Commission (CSRC), said in a briefing on Wednesday that the watchdog would protect the interests of Chinese companies listed abroad and help high-quality firms that are listed overseas to offer shares on mainland and Hong Kong exchanges.
Risks of a financial decoupling between China and the US are on the rise amid intensifying trade tensions, with Republican lawmakers urging the US Securities and Exchange Commission to expel Chinese firms including Post owner Alibaba Group Holding from American exchanges over national security concerns. A decoupling could trigger a US$2.5 trillion sell-off in stocks and bonds, which would force US investors to offload nearly US$800 billion of Chinese stocks, Goldman Sachs said in April.
The CSRC’s plans would “offer companies an alternative to the risk of delisting from US exchanges and help ease foreign investors’ concerns”, said Shen Meng, a director at Beijing-based investment firm Chanson & Co.
A conversion or dual listing on the mainland or in Hong Kong could also help restore these stocks’ fair valuation and improve companies’ ability to raise capital, he added.
As part of further efforts to stabilise China’s financial markets and attract foreign investment, the CSRC planned to simplify the approval and account-opening process for qualified foreign institutional investors, encourage foreign firms to apply for licenses in securities and fund advisory services, and support them in setting up yuan-denominated funds investing in China, Wu said.
