The Conditions For Foreign Companies To List Are Not Yet Ripe.

The 2015 annual report of the people's Bank of China released by the central bank again pushed the listing of foreign companies to the front desk, causing severe storms in public opinion. The column entitled "orderly convertibility of RMB capital accounts" mentioned in this annual report refers to four key tasks of the central bank in the coming period, of which second tasks are to further promote two-way opening of capital markets. Allowing qualified foreign companies to issue shares in China may consider the introduction of convertible stock certificates (CDR), and further expand the openness of the bond market. As this article is published in the annual report of the central bank, so in the opinion of the masses, it also represents the central bank's viewpoint.

This view of the central bank really surprised me and other cautious investors. Although the media reported the news, they all said it was "allowing research to allow high-quality foreign companies to issue shares in China". Meanwhile, the central bank's article also said that "convertible equity depository receipts (CDR)" could be considered. But the first thing investors think of is the revival of the international board, which is full of panic on the A shares of foreign companies. After all, in my opinion, the A share market has not had the conditions to accept the listing of foreign companies for at least three or five years.

Of course, from the perspective of two-way opening of the capital market, the A share market should allow foreign companies to list A shares. Moreover, from the long-term development of the A share market, it is a general trend for foreign companies to list A shares, and the A share market should also welcome foreign companies to list A shares. But at this stage, the A share market can not afford to accept foreign companies' listing. The experience of China's stock market shows that the A share market is not only a little bit different from the mature markets such as the US stock market. Such a market is simply not suitable for foreign companies to enter. Otherwise, China's stock market will become an ATM for foreign companies. The wealth of Chinese citizens will continue to flow to foreign companies and foreign shareholders.

As we all know, the A share market serves for financing, and the financing function is the most important function of the A share market. It can be said that the positioning of the A share market is different from other mature markets such as the US stock market. The reason why the A share market is located is because the A share market bears the mission of supporting the development of the real economy, and even the establishment of the A share market is for the reform of state-owned enterprises. Therefore, investors often see the leaders of the party and the State concerned about the development of the stock market, and even guide the development of the stock market.

And it is based on support. Real economy Development needs, A share market is unable to accept foreign companies. list After all, there are as many as 800 companies listed on the A stock market. Moreover, more companies have been assigned to the new three board market whose financing function is not smooth, many of which are eyeing the A share market.

And in June 20th, at the forum of heads of financial institutions attended by Premier Li Keqiang, Premier Li Keqiang stressed the need to promote equity financing through multiple channels and explore the establishment of multi-level capital market transfer mechanism. Raise the proportion of direct financing. The rotating board mechanism mentioned here is actually hoping to transfer the new three Board companies to the A share market so as to better support the development of these companies. It can be said that at present, domestic enterprises are all crying for food. A share market is hard to spare energy to take care of the financing needs of foreign companies.

Of course, more importantly, the A share market itself is not mature. not only Investor Immature and regulators are not mature. Even the whole legal system of the A share market is not mature, which leads to a large number of problems in the A share market. For example, the legal system of the A share market is still serving the listing of state-owned enterprises, so that the listing of private enterprises and private enterprises shares the dividend policy of state-owned listed companies. The most obvious problem is the size of the problem. This problem is not prominent for the state-owned enterprises, but for private enterprises and private enterprises, it is very prominent, and the stock market has become the ATM of these enterprises' primitive shareholders.

Moreover, due to the lack of strict market supervision measures in the A share market, the lack of severe legal system and the lack of strict investor protection measures, various illegal activities in the A share market prevail, and the interests of investors are always damaged. And because of the prevailing market speculation, the valuation of most stock in the A share market is much higher than that in the mature market. Even through the "stock market Adventures of the United States stock market" stock company, every family has to roll back the A share market. Compared with the US stock market, the A share market with loose market supervision, imperfect legal environment, lack of investor protection measures and high stock valuation is the paradise of the stock market. Because only in the A share market can these companies be able to cash in on their money.