Securities bourse proposal to boost Chinese yuan
The government of Macao is mulling setting up a securities exchange in the special administrative region, a move that Chinese experts said should boost the internationalization of the yuan.
The new bourse would also play a supplementary role in advancing the domestic capital market as it would likely focus on innovative financial services, experts said.
A plan to establish a Macao securities exchange has been submitted to the central government, trying to forge it into a NASDAQ-style offshore yuan market, He Xiaojun, director of the Guangdong Local Financial Supervision and Administration Bureau, told a forum on Saturday.
In a statement on its official WeChat account on Sunday, the Monetary Authority of Macao said it had authorized global consultancies to conduct a feasibility study on setting up a yuan-denominated securities market in Macao and relevant work was being conducted in an orderly manner.
The feasibility study would bring "Macao's advantages into full play and serve what the country needs" based on a comprehensive consideration of the deployment of the Guangdong-Hong Kong-Macao Greater Bay Area, the post read.
Given mature financial centers nearby, Macao must fully understand its own advantages to break through in this sector and achieve differential development, the authority said.
The advantage of Macao is its strong sense of identity as a part of China, which closely connects its development with neighboring Guangdong and other regions of the mainland, Liang Haiming, dean of the Belt and RoadInstitute at Hainan University, told the Global Times on Sunday.
Macao is deeply integrated into a national and regional development strategy and can use "one country, two systems" to achieve faster development, according to Liang.
"To build a securities exchange in Macao would facilitate creating a market for the internationalization of the yuan," Liang said.
Macao was also a good place to develop yuan business and financial services that target Portuguese-speaking countries, he noted.
As this year marks the 20th anniversary of the Macao's handover, "it is our expectation that a new bourse could be placed on a gift list of the 20th anniversary," bureau director He was quoted as saying in a report by news site finance.sina.com.
He noted that the city of Shenzhen in South China's Guangdong Province helped Macao craft the plan.
The securities exchange might compete with neighboring Hong Kong, which is undergoing social unrest, experts noted.
But the rivalry would be "benign," Liang asserted, as Hong Kong focuses on the traditional financial industry while Macao is likely to develop innovative finance services, which is "complementary."
Macao is expected to strengthen efforts to attract talent and support industries like accounting and law, Shenzhen-based industrial observer Wu Hao told the Global Times on Sunday.
Wu noted the new bourse will drive the growth of financial innovation faster in the area.
Director He also said at the forum that Guangzhou Futures Exchange is likely to be approved by the end of this year.
He said that there are 45,000 high-tech firms in Guangdong, but only 600 are listed.
The quantity is too small as the Shenzhen and Shanghai bourses cannot accommodate too many listed companies, He said. Guangdong is expected to recommend more local star companies list, he noted.