The China Securities Regulatory Commission (CSRC) vowed to give priority to the financing of companies that break foreign strangleholds in core technologies. The capital market will play an increasingly important role in China's economy. Only by improving the mechanism of the capital market and enhancing its capability of serving the real economy can the capital market better support the development of new quality productive forces and contribute to a stable economic recovery, analysts said. The CSRC will further carry out comprehensive reform and opening-up of the capital market to improve mechanisms concerning IPOs, merger and acquisition (M&A) deals, as well as private equity and venture capital funding. Zhou Xiaozhou, an official of the CSRC, said at a forum held in Beijing that the authorities will implement 16 measures that the CSRC has announced to better serve sci-tech companies, and it will give priority to the financing of companies that break foreign strangleholds in core technologies.
In 2023, A-share sci-tech companies that are engaged in next-generation technologies, new energy and other emerging industries disclosed more than 1,100 M&A deals, with transactions exceeding CNY360 billion, according to Zhou. Gao Dongsheng, Chief Economist of the Ministry of Industry and Information Technology (MIIT), said at the same forum that the Ministry will step up support for the development of industry-leading companies, nurture unicorn companies, and spark the emergence of more small and medium-sized tech firms. Driven by effective investment, the development of new quality productive forces in China is picking up speed, and as a result the medium- and high-end manufacturing sectors are seeing faster growth. According to the National Bureau of Statistics (NBS), the value added of equipment manufacturing increased by 9.9% year-on-year in April, 3.9 percentage points faster than in the previous month. The value added of high-tech manufacturing increased by 11.3%, 3.7 percentage points faster.
In order to enhance the capital market's capability of supporting the development of the new quality productive forces, the authorities should formulate targeted policies to encourage innovations in talent, financial products, services and management, Bian Yongzu, Senior Industry Research Fellow, told the Global Times. For example, efforts are needed to develop “patient capital” to support long-term investment in new quality productive forces, he said. Ten foreign-controlled securities firms, nine wholly-owned foreign fund management companies and three foreign-controlled futures companies had obtained approval to operate in China, the Global Times reports.
