Time zone difference not a problem for proposed London-Shanghai stock connect, says British finance official

The time difference between Britain and China should not be seen as a problem, but rather the reason for having a stock connect scheme between London and Shanghai, according to Britain's Economic Secretary to the Treasury Harriett Baldwin.

Speaking with the South China Morning Post during her visit to the city, she explained why Britain was keen on being the next market to establish a cross-border trading linkage with the Shanghai market after Hong Kong.

"The stock connect between London Stock Exchange and Shanghai Stock Exchange will strengthen the role of the UK to act as the Western gateway for mainland investors to invest in the Western capital market. It will also allow international investors trading through London to invest in Chinese companies," Baldwin said.

"The time zone difference is an issue but this is also the whole point of how London can act as a gateway for investors to invest in the China market during UK trading hours," she said.

Baldwin said the difference also means any stock connect plan would not be in direct competition with Hong Kong because it is going to enable other groups of investors who trade in other time zones to invest in the Shanghai market.

"The new stock connect will be an important development for all of us. It will bring benefit to all markets. It will widen the size of the investment and bring in new Western investors to trade," she said.