MNI BRIEF: Increase Proportion Of Foreign Capital - Yigang

Policymakers should make efforts to increase the proportion of foreign investment in China’s capital markets while also ensuring financial and economic security, Yi Gang, former PBOC governor has recommended in a speech at the National People’s Congress.

Yi said China needed to promote foreign holdings upwards from today's 1% of banking assets and 3% of the stock and bond market. Regarding financial market development, authorities need to promote long-term funds and increase the amount of capital that can withstand risk.

In the banking sector, stronger banks should partner with provincial branches to invest in start-up hard technology firms and provide supervision, and assessment services.

Policy advisors recently told MNI authorities should provide more pro-growth policies, limit IPOs to rebalance supply and demand, and encourage more long-term funds to revive confidence in China’s stock market. (See MNI: China Should Limit IPOs, Boost Growth To Lift Stock Market - Bonds & Currency News | Market News)