China has announced it's setting up a new Strategic Emerging Industry Board to attract domestic innovators to seek funding in Chinese exchanges instead of going abroad.
Fang Haixing, a deputy chairman of the China Securities Regulatory Commission, announced the central government's support for direct financing in the coming year.
"First, we'll actively develop stock markets and increase the levels of the market, as well as setting up the strategic emerging industry board, which must be rolled out next year. Second, we will speed up improving the New Third Board, increasing the number of listed companies, especially the listing of medium, small and micro-sized companies and high-tech companies, and encourage qualified companies to try the National Equities Exchange and Quotations system."
The new board is aimed at the country's domestic high-growth and innovative companies, while the National Equities Exchange and Quotations system, or more commonly known as the New Third Board, is a national share transfer system for small- and medium-sized enterprises.
Huo Da, a director with the regulator, said they are working to speed up the transfer system for New Third Board companies to the bigger Shanghai and Shenzhen bourses.
"China Securities Regulatory Commission will support the reform of the stock-issuance registration system, and further explore other channels for New Third Board enterprises to transfer trades to Shanghai and Shenzhen stock exchanges under relevant legal framework."
Next year will see a major shift on China's stock markets to a registration based IPO system.
At the same time, the China Securities Regulatory Commission has suspended the listing and financing of private fund management institutions on the New Third Board.
Officials said they are also working to roll out supervision and management measures for private funds on the New Third Board which is designed to serve the real economy.
A stock connect scheme between Shenzhen and Hong Kong will also be launched next year.
The stock connect schemes allow investors to trade on both bourses under a quota.
Trading started last November under a similar stock link system between Shanghai and Hong Kong.
