THE Chengdu Government's crackdown on the black securities market has been effective, according to the city's mayor. The black securities market used to exist on a considerable scale, with shareholding companies issuing shares direct to investors, and investors dealing shares between themselves on the streets. Chengdu Mayor Wang Rongxuan said that although the black market might still exist, the majority of trading had been eliminated after modification of the city's securities market earlier this year. In March and April, the Government made it compulsory for all shares to be issued and dealt through state-run securities firms. AS a result, the scale of such brokerage services has increased. ''That was to protect investors' interest. In the black market, there were fake bank notes and fake share certificates,'' Mr Wang said. Meanwhile, the governments of Chengdu and Sichuan, the province of which it is capital, are seeking Beijing's approval for the setting up in Chengdu of the country's third stock exchange, after those in Shanghai and Shenzhen. Mr Wang feels Chengdu is the most eligible candidate for a stock exchange if one were to be opened in southwestern China. ''According to the State Council's plan, Chengdu is to be southwestern China's centre of science and technology, commerce and finance, and its connection point for traffic and communication,'' he said. ''This confirms Chengdu's status in southwestern China.'' The city boasts the largest savings deposits and loans in both northwestern and southwestern China. Apart from the securities market, the city is also developing its telecommunications and infrastructure. It has bought equipment from the world's leading telecommunications equipment suppliers, including Siemens, AT & T and Motorola. The capacity of the city's telephone system is also increasing, with one more digit being added to the previously six-digit telephone numbers earlier this month. Mr Wang expects there to be a total of 400,000 telephone lines available by the end of next year - a 150 per cent increase on the existing 160,000. The city is also planning an underground railway together with a Hong Kong company, which has yet to be approved by the central Government. While Beijing has declared war against corruption, Mr Wang said the cadres in Chengdu were not corrupt as a strict monitoring system was in place. ''For instance, they have to report to a special unit on the gifts they have received from foreign merchants,'' he said.