The Great Debate UK
from The Great Debate:
Time for China to act on foreign listings
-- Wei Gu is a Reuters columnist. The opinions expressed are her own --
China has talked about plans to allow foreign companies to float on its domestic stock markets for at least a decade, but that's all there has been: talk.
Now would be a good time to convert some of that talk into action. Beijing has been struggling with its own investment strategies: the state gets feeble returns on the U.S. Treasury bonds it owns, and its equity stakes in foreign financial firms are well under water.
So why not diversify by allowing 1.3 billion Chinese citizens have a go rather than a few bureaucrats working for China's sovereign fund? The many might even do better than the few. And it would give Chinese savers a chance to buy global blue chips at credit-crunch prices.
The idea of opening up China's equity markets to foreigners may seem fanciful, but it dovetails with another big national objective. China wants to build Shanghai into a global financial centre by 2020, but that requires a deeper and internationalised equity market. Only when that is in place will foreign money descend on Shanghai, together with an army of bankers, lawyers and accountants.
from The Great Debate:
Time for China’s banks to think local
-- Wei Gu is a Reuters columnist. The opinions expressed are her own --
When foreign strategic investors were invited to take stakes in Chinese banks, the word "strategic" had a clear meaning for their hosts.
The banks were supposed to stay in for the long term, and that's why they had the chance to buy big stakes at bargain prices. Yet many have behaved like "foreign speculative investors", as they are now called in China -- they took the cheap deal and then flipped the shares for a fast profit.
