Tianjin's vice mayor said yesterday the government will
implement an August 20 plan for the city's citizens to buy and sell
stocks in Hong Kong.
It will mark the first time individual Chinese mainland
investors have been allowed to trade equities outside the mainland,
Bloomberg News reported. The so-called "through-train" plan,
delayed because of "issues with timing and conditions," will have
no problems with implementation, Vice Mayor Cui Jindu said at an
investment forum in Beijing.
The pilot program will be extended to other Chinese cities "over
the long term," he said.
China's currency regulator said on August 20 that citizens with
Bank of China Ltd accounts in Tianjin would be allowed to buy Hong
Kong equities in a plan aimed at draining excess cash from the
economy.
The program was delayed after objections by the securities and
banking watchdogs, three officials at the banking regulator said on
September 5.
The program wasn't scrapped and will expand to a "multi-bank and
multi-city" scale, former central bank adviser Li Yang said
yesterday at the conference. Li is research head of finance at the
Chinese Academy of Social Sciences.
The Chinese government, which is committed to letting Chinese
investors buy in Hong Kong, must "guarantee financial stability,"
Hong Kong's Chief Executive Donald Tsang said in Beijing last
Friday after meeting Chinese officials.
HK's Hang Seng Index rose as much as 4.7 percent yesterday, the
biggest intraday rise in 11 days, after Cui's comments. The index
plunged five percent on November 5, the steepest fall since the
September 11, 2001, terrorist attacks, after Premier Wen Jiabao
said the program may be delayed.
The government needs to study the risks, increase knowledge
among mainland investors and prepare regulations to protect the
stock markets in Hong Kong and on the mainland before launching the
program, Wen said on November 3.
(Shanghai Daily November 30, 2007)
