China to launch new Beijing stock exchange to boost small businesses
China will create a new stock exchange in Beijing, in a bid to foster small business development and boost the country’s equity financing.
In an announcement at an international trade fair, president Xi Jinping said the new Beijing exchange would “provide a platform for innovative small and medium-sized enterprises.”
Giving no date or further details for the opening of the new exchange, Xi also said the existing Beijing National Equities Exchange And Quotations Co exchange would be “reformed.”
It marks a significant move in China’s staunch campaign to develop its onshore capital markets and reduce debt levels in its economy.
And while the focus is on boosting domestic markets, it comes after Beijing’s recent campaign against offshore listings of Chinese companies in the US that has caused investor doubt over the prospects of Chinese companies that IPO on Wall Street.
This is coupled with China’s broader regulatory crackdown in recent months on Chinese tech giants and other business sectors including education for perceived monopolistic behaviour and unfair competition.