Shi Donghui, Director Of The Capital Market Research Institute Of Shanghai Stock Exchange: Promoting Systematic Reform Of Capital Market, Focusing On Five Aspects.

Shi Dong Hui

In December 5th, the 2019 International Forum on finance and economics was held in Guangzhou with the theme of "China's capital market of innovation and openness".

On the forum, Shi Donghui, director of the Shanghai Stock Exchange Capital Market Research Institute, made a keynote speech on deepening the reform of the capital market to help the development of innovative enterprises.

Shi Donghui pointed out that the core of financial supply side reform is to reform and develop the capital market, especially through the establishment of a multi-level capital market system to solve the problem of matching funds with different risks and benefits and matching different types of enterprises.

"At present, there are many problems in the domestic capital market, for example, the market is not strong enough for innovative enterprises, the pricing efficiency is not high, and speculative volatility is too large," Shi Donghui said. "From the perspective of supporting the development of the real economy, the biggest problem is that the market is not sufficiently inclusive. The current conditions for listing and listing can be adapted to the time of China's original industrialization development, but it is difficult to reflect the transformation and upgrading needs of China's economy. The A share market is far from enough to accommodate new economic enterprises. In the US share market, the market share of the new economic companies is close to 50%, but in the Shanghai and Shenzhen stock markets, the market share is less than 15%, which results in the performance of the mainland stock index of China card overseas, which is much better than that of the Shanghai Composite Index.

Under the above realistic background, Shi Donghui believes that capital market needs systematic and comprehensive deepening reform. Under the unified arrangement of the SFC, the focus and direction of a series of capital market reforms have been put on the agenda, including the following aspects:

First, improve the market system. The promotion of market-oriented reform needs qualified market players. Under the precondition of immature market intermediaries and investors, the market-oriented reform of individual armed forces often leads to various new problems. Therefore, it is necessary to formulate effective market restraint mechanism to regulate the behavior of the market players, especially to strengthen the criminal punishment and civil responsibility investigation for the large shareholders and the real controllers who encroach on the interests of the minority shareholders.

Second, expand market depth. We should step up efforts to attract long-term capital to enter the market, continue to open up to the outside world, and improve the proportion and depth of market institutional investors.

Third, enhance market efficiency. Let the market form a normal supply and demand relationship, and the rhythm and quantity of stock issue should be determined by the market. At the same time, we should increase the intensity of financial innovation, and make the market maintain pricing efficiency through various trading strategies and trading methods.

Fourth, let go of market access. Expand market inclusiveness and allow different types and industries to get efficient financial services in the capital market.

Fifth, maintain market stability. Especially for all kinds of highly leveraged securities business or financial transaction products, we should maintain vigilance and dynamic monitoring to prevent the occurrence of various systemic risks.

Specifically, to "how to change" the path, Shi Donghui said that the successful experience of China's economic reform is "incremental reform", "in vitro cultivation of a new market, through the new market reform pilot, we call the" reform experiment field ", explore a set of effective system, rules, system, and then transplant it to the" stock market ".

The "Chuang Chuang ban" took on the role of "reform experimental field". It is a major strategic plan for implementing the reform of the financial supply side. Through the registration system reform, especially the successful experience, best practices and the reality of the Chinese market, we will formulate a highly market-oriented operation system in issuing, listing, trading, continuous supervision, delisting, and legal accountability, and then copy it to the stock market after the operation is mature. Shi Donghui said.