Foreign Investors Hold USD 368 Billion of China's A-Shares
The China Securities Regulatory Commission's (CSRC's) former chairman, Xiao Gang, named four main capital-attracting drivers at the International Monetary Forum on July 25.
By the end of June 2020, the balance of foreign holdings of Chinese A-shares reached USD 368.40 billion, a year-on-year increase of 13%; the balance of Chinese bonds held by foreign entities surpassed USD 369 billion, up by 10% compared with last year and three times the amount in 2016.
According to Xiao Gang, who serves the country's main market regulator — the China Securities Regulatory Commission, or CSRC — global capital managers' interest in Chinese financial assets can be best explained through four aspects:
► China is the mainstay of stability for the global economy;
► A-shares were undervalued in the major global stock market;
► China's capital market is relatively large;
► Measures to improve the outward financial situation in recent years have taken effect.
Reforms in China, including the registration-based system of the ChiNext board and the Star Market, have attracted more foreign capital and are providing an appropriate environment for domestic companies in the public equity space.