Premier Li says Hong Kong and Shenzhen exchanges to link 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 yesterday, just hours before the local bourse reported a 13 per cent profit growth due to its tie up with the Shanghai bourse in November.

“The Shenzhen-Hong Kong stock connect programme will be launched at an appropriate time,” Li told the annual session of the National People’s Congress in Beijing. “The Shanghai and Hong Kong stock connect has been launched successfully. More financial reforms will come.”

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 this year.

The premier told the Congress his other financial reforms which 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. Li also wants to promote the private sector to set up small and medium banks.

The premier said  he plans to introduce  a deposit insurance scheme which would bolster the public’s confidence in using  smaller banks.

As for the yuan, the country will keep the currency at an “appropriate level” by adding a more flexible trading band, Li said.