Premier says Shenzhen through train to be launched at ‘appropriate time’
Beijing will link up the Hong Kong and Shenzhen bourses at an “appropriate time”, Premier Li Keqiang announced in his annual work report on Thursday morning ahead of the local market’s results announcement at noon.
Hong Kong Exchanges and Clearing is already benefiting from higher turnover after a tie-up between the Hong Kong and Shanghai stock exchanges was launched in November, allowing investors to conduct cross-border trading. Many analysts say the local bourse could have seen its profit rise by 12 per cent to about HK$5 billion.
“The Shanghai and Hong Kong stock connect has been launched. The Shenzhen programme will be launched at an appropriate time,” Li told the annual session of the National People’s Congress in Beijing.
Li said the stocks through-train schemes between Hong Kong and Shanghai and then Shenzhen would be a trial for financial reform on the mainland. It still has capital controls but international investors can now trade Shanghai-listed A shares via HKEx and that arrangement is expected to be expanded to Shenzhen later this year.
HKEx chief executive Charles Li Xiaojia is expected to expand on plans for the link with Shenzhen at a results press conference at 4.30pm.
About a third of the 300 billion yuan quota for international investors to trade in Shanghai has been used up, while mainlanders have used up only 10 per cent of the quota available for them to invest in Hong Kong stocks via the scheme.
Li said other financial reforms would include the launch of free-trade zones in Guangdong, Tianjin and Fujian and plans for free-trade agreements with Iceland, Switzerland, South Korea and Australia. Reform of interest rates and private banks would also be areas of focus.
Li wants to encourage the private sector to set up small and medium-sized banks. “Whenever one would have all conditions mature enough to launch a bank, we would approve that one be set up," he said. "There would be no quota.".
He also said the mainland planned to introduce a deposit insurance scheme.
