The Chinese government is cracking down on large companies and taxing wealthy individuals, but it’s also trying to encourage the growth of an entrepreneurial middle class. Today China’s leader highlighted small companies and ordinary people of limited means, and promised a new Beijing stock market.
There are so many different government campaigns against internet, entertainment, financial and other industries going on right now that updating SupChina’s list of crackdowns and regulatory initiatives is a daily task. But matching the energy of those is actions are a series of moves the Chinese government is taking to improve living standards for a large portion of the country’s population:
Yesterday Premier Lǐ Kèqiáng 李克强 headed up a government meeting where he talked (in Chinese) about reducing inequalities in education, including concrete measures such as:
Arranging 300 billion yuan ($46.46 billion) of credit for local corporate banks to grant loans to “small and micro enterprises and individual industrial and commercial households.”
Raising the “maximum loan limit per student per student per year from 8,000 to 12,000 yuan ($1,240-$1,860), and for postgraduate students from 12,000 to 16,000 yuan ($1,860-$2,480).
Today, Xí Jìnpíng 习近平 gave a very short speech by video to the 2021 China International Fair for Trade in Services (transcript in Chinese, English). With the aim of supporting the development of ””service-innovative small and medium-sized enterprises” (SMEs), he promised to:
Deepen the reform of NEEQ (aka the New Third Board 新三板);
Establish the Beijing Stock Exchange (北京证券交易所).
It’s likely we’ll soon hear plenty more about the Beijing Stock Exchange, but Xi gave no further details in his minutes-long speech.
Xi’s ideas will almost certainly be implemented swiftly: “In a statement issued shortly after Xi’s remarks, the China Securities Regulatory Commission (CSRC) said its leadership was ‘excited’ at the prospect, would study the president’s proposal in depth and resolutely implement it.” per Reuters.
NEEQ and the Beijing Stock Exchange are connected: “Selected companies currently traded on the NEEQ will list on the new Beijing exchange,” the CSRC said.
NEEQ or the National Equities Exchange and Quotations was established in 2013 to foster “innovative, start-up, and high-growth micro, small and medium-sized enterprises.”
In related news, the People’s Bank of China will provide 300 billion yuan ($46.4 billion) of low-cost fundingto banks to lend to SMEs.
Jeremy Goldkorn worked in China for 20 years as an editor and entrepreneur. He is editor-in-chief of The China Project, and co-founder of the Sinica Podcast. Read more