The China Securities Regulatory Commission (CSRC) is taking significant strides to strengthen the country’s capital market through strategic long-term investments. At a press conference in Beijing, CSRC Chairman Wu Qing emphasized the critical role that sustained investments play in stabilizing the capital market.
Following the release of a new implementation plan, the CSRC aims to overcome existing barriers and propel the high-quality development of the capital market. This comprehensive plan addresses challenges faced by key long-term investors, including commercial insurance, public funds, national social security, and basic pension funds, by introducing measures that facilitate their active participation.
In the short term, the plan mandates an increase in both the scale and proportion of A-share investments. Looking ahead, it sets up institutional frameworks designed to encourage value-based and stable investment behaviors. These frameworks include enhanced evaluation systems, tailored investment policies, and an improved market ecosystem.
Wu Qing highlighted that public funds are expected to amplify their A-share holdings by at least 10 percent annually over the next three years. Additionally, major state-owned insurance companies are required to allocate 30 percent of their annual new premiums to A-share investments starting this year, injecting hundreds of billions of yuan into the market each year.
Furthermore, the second phase of a pilot program for insurance funds, slated for the first half of 2025, is set to introduce an additional 100 billion yuan ($13.7 billion) in long-term stock investments. To support these initiatives, the plan extends the evaluation periods for long-term funds, ensuring that investments remain insulated from short-term market fluctuations and fostering greater stability.
Wu also showcased the success of the national social security and basic pension funds, which have achieved an average annualized return of 11.6 percent on A-share investments over the past two decades. This success is attributed to the fund’s commitment to value-driven, long-term strategies.
In conclusion, the CSRC’s new measures are designed to enhance returns on long-term capital investments, creating a mutually beneficial environment for all market participants and driving sustained economic growth.
Reference(s):
China sets targets for long-term investment in capital market
cgtn.com
