China’s Capital Markets

‘This volume is well-structured, well-organized and well-written. The in-depth analysis is supported by concrete facts and observations. The book is recommended to academicians and market practitioners.’
– Maximo Eng, Journal of Emerging Markets

‘This book is a welcome addition to Edward Elgar’s series on the Chinese economy. It provides a wealth of information on the historical development and the current state of the Chinese financial system. Particularly useful for readers who do not have access to the original Chinese literature are the overviews of each market and the many detailed accounts of the historical development of markets and regulations.’
– Nicolaas Groenewold, Pacific Affairs

China’s accession agreements to the World Trade Organization promised to open up the financial sector to foreign competition by the end of 2006, affording a wealth of opportunities for domestic and international investors. However, there also exist inherent risks and challenges, including inefficient financial markets, inadequate and fast-changing regulations, excessive governmental influence, and lack of transparency in accounting and corporate governance. The contributors to this book explore these perplexing and intertwined issues as they systematically document and analyze the capital market’s development in association with the banking system and legal framework.

China’s economy has been growing rapidly since the late 1970s and is expected to maintain this momentum in the foreseeable future. Coupled with the biggest population in the world, there is tremendous growth potential for China’s capital markets and financial services industry, both vital to the continued development of the economy. The contributors present research on all facets of China’s markets including: stock and bond markets; futures and over-the-counter markets; regulatory issues; and the development and roles of financial institutions such as brokerage firms, banks and insurance companies. Also addressed are the recent performance of equity markets, the emergence of small and medium enterprises, and the state banks’ bids to be listed in overseas stock exchanges. Taken together, the book sheds a welcome light on China’s overall economic growth.

This comprehensive look at the future of China’s economy will be of great value to students and scholars of China. Investors and policymakers will also find it of great practical use.

Contents:

Preface

Introduction: Development and Challenges of Chinese Financial Markets
Kam C. Chan, Hung-gay Fung and Qingfeng ‘Wilson’ Liu

PART I: FINANCIAL MARKETS
1. Chinese Stock Market: Perspectives in Institutional Structure, Regulations and Performance
Kam C. Chan, Hung-gay Fung and Julia S. Kwok

2. Bond Markets: Introduction and Analysis
Hung-gay Fung, Ying Han and Qingfeng ‘Wilson’ Liu

3. Futures Markets
Jot Yau

4. The Small- and Medium-Enterprise Stock Market
Hung-gay Fung and Qingfeng ‘Wilson’ Liu

PART II: BANKING, INSURANCE AND FOREIGN EXCHANGE MARKETS
5. The Banking System – Development and Current Issues
Hung-gay Fung and Qingfeng ‘Wilson’ Liu

6. Investment Banking in China: Past, Present and Future
Alan V.S. Douglas and Alan Guoming Huang

7. China’s Insurance Market: Challenges and Opportunities
Hung-gay Fung, Fei Liu and Yanda Xu

8. China’s Foreign Exchange Market
Gaiyan Zhang

PART III: REGULATORY AND OTHER ISSUES
9. China’s Qualified Foreign Institutional Investor and Qualified Domestic Institutional Investor Programs
Hung-gay Fung and Qingfeng ‘Wilson’ Liu

10. A Primer on the Securities Investment Fund Industry in China
Xiaoqing Xu

11. Overseas Listing of Chinese Companies
Congsheng Wu

12. Privatization, Corporate Structure, Market Transparency and
Capital Markets
Kam C. Chan, Hung-gay Fung and Qingfeng ‘Wilson’ Liu

13. Chinese Financial Markets: Regulators and Current Laws
Mary Ip

Index