The spokesman of the China Securities Regulatory Commission (CSRC) has recently addressed that, the CSRC would fully implement opening-up evaluation of the securities industry and the capital market, and continuously improve relevant opening-up policies to actively and steadily promote the opening-up of the securities industry and the capital market.

According to the spokesman, year 2008 is the 30th anniversary of China’s reform and opening-up, thus comprehensive review and sum-up of the reform, the opening-up and the historical experience becomes an important task of this year. As a fundamental part of China’s economic system, we should earnestly sum up the experience of reform and opening-up of the capital market. Especially, the current opening-up policies and implementation effect of the securities industry and the capital market need to be fully evaluated and summarized. It will lay a solid foundation for further improvement of the opening-up policies and orderly promotion of opening-up of the securities industry and capital market.

The spokesman pointed out that over the past 10-odd years, China has actively and steadily promoted the opening-up of the securities industry and the capital market. Early in the 1990s when the securities market was established, China implemented the opening-up policies including the B shares market for foreign investors and permission of domestic enterprises’ overseas listing. After joining the World Trade Organization (WTO), China has fulfilled relevant promise of opening up the securities industry, successively approving the establishment of 4 joint-venture securities companies and 31 joint-venture fund management companies, permitting 4 foreign securities institutions’ representative offices in China to be special members of the Shanghai Securities Exchange (SSE) and the Shenzhen Securities Exchange (SZSE), and respectively permitting 41 and 19 foreign securities institutions to engage in B share trading on the SSE and the SZSE. Besides its promises to the WTO, China has actively carried out a series of opening-up system arrangements including the system of qualified foreign institutional investors (QFII) and that of qualified domestic institutional investors (QDII). Upon launch of the Sino-US Strategic Economic Dialogue, 6 foreign securities exchanges have been approved to establish representative offices in China. The total investment line of QFII has been raised to 30 billion dollars; the “Rules on Establishing Foreign-shared Securities Companies” has been modified, resuming the examination and approval of establishment of joint-venture securities companies; the “Trial Regulations on Establishing Subsidiaries by Securities Companies” has been published, permitting the expansion of business scope by eligible joint-venture securities companies; eligible foreign investment companies have also been permitted to issue RMB-denominated stocks. In general, the capital market has not opened up for a long time, yet opened up to a large extent, which basically adapts to current development of the securities industry and t maturity of the capital market in China.

According to the spokesman, the opening-up of the capital market plays a positive role in the aspects including introducing management technology, promoting competition and innovation, improving market services, boosting market development and enhancing the international competitiveness of China’s securities business institutions. However, according to the international experience, excessive and over-fast opening-up will result in potential financial risks and a strike to the capital market. In the next period, we should, by continuously following the basic principle of “advancing step by step, controllable safety, competition and cooperation, mutual benefits and common wins” and an active and practical attitude, timely and appropriately expand the opening-up of the securities industry and the capital market. Due to the continuous turbulence of the global financial market and great fluctuations in major stock markets since last year, many large multinational financial institutions have suffered great losses, and the growth of the global economy has slowed down. Meanwhile, as much work has to be done in establishing the fundamental system of the domestic capital market, and overall strength of the securities business institutions is weak, the market’s fast development demands for a series of new challenges and requirements. China will pay close attention to the changes in the global economy and the international financial market and the connection of the domestic and the overseas capital markets, deepen analysis and evaluation of the opening-up policies’ implementation effect, hidden risks, advantages and disadvantages, gains and losses and external environment. Based on this, we will further improve the opening-up policies and gradually enhance the international competitiveness and risk tolerance capacity of China’s securities industry and capital market, thus promoting the sound development of China’s capital market.

The spokesman finally pointed out that, after completion of the opening-up evaluation of the securities industry and the capital market, the CSRC will study and propose a medium-and-long-term strategic plan for the opening-up of China’s securities industry and capital market as well as suggestions on policies of further opening-up according to the evaluation result.