CRI听力:China to Further Reform Capital Market to Better Serve Real Economic Activities

The announcement was made by China's top securities regulator at Lujiazui Forum 2015 that opened Friday in Shanghai.

Government officials, economists and corporate executives gathered at the two-day forum to provide advice for the country's financial sector.

Xiao Gang, chairman of the China Securities Regulatory Commission or CSRC, points out that the country's capital market reform will focus on building a multi-level market system.

"We will open a capital-raising pilot with crowd funding model in order to offer new equity financing channels for innovating businesses. We will further push the growth of private market to offer more capital for them. The venture investment mechanism will be improved by expanding venture capital and angel investment, to attract more private capital to flow into the field of technology and innovation."

To achieve the goal, Xiao says that securities industry will also reinforce innovation on products, services and business models.

Currently, the country has about five hundred companies listed on ChiNext, China's Nasdaq-style board, aiming to attract innovative and fast-growing enterprises.

High technology enterprises account for 90 percent of all the ChiNext listed companies.

However, according to Xiao, the country's capital market is not competent enough to serve innovative and high-tech businesses.

"The current capital market system is not capable enough to serve China's 15 million medium and small size enterprises, with limited coverage. The venture capital system is not perfect enough, and it's still difficult for start-ups to obtain financing due to lack of angel investment and venture investment. Moreover, better legal system and stock equity culture are badly in need to make the capital market play better role in serving high technology and innovating enterprises."

Usually social capital is reluctant to invest on start-up companies due to their high risks and more uncertainties.

However, under the multiple-tiered capital market, Xiao says the boost of venture investment will definitely be a very good solution.

"Innovating businesses in the early stages usually have small capital funds, with features of high risk and high investment. The development of venture investment like Angel capital can remedy the limitations of traditional bank financing and create more new jobs."

CSRC also vows to further diversify, and provide tailored products and services to support the growth of startups in technology and strategic industries.

Increasing the convertibility of the Chinese currency, and to further raise the status of the yuan on the global market are also among the many topics at the forum.

First launched in 2008, Lujiazui Forum is a top level platform to solicit suggestions for China's finance sector and Shanghai's construction into a global financial center.

For CRI, I'm Wang Wei.