Chinese government announces major reforms to boost capital market

China's State Council Information Office (SCIO) held a press conference on Thursday on actively encouraging the flow of medium- and long-term funds into the capital market and promoting its high-quality development, CGTN reports. 

China Securities Regulatory Commission (CSRC) Chairman Wu Qing outlined plans to gradually expand corporate pension coverage, encouraging employers that meet specific criteria to explore allowing individuals to make their own investment choices within corporate pension schemes. To diversify investment strategies, the CSRC supports corporate pension fund managers in adopting differentiated approaches.

Wu further emphasized the importance of enhancing public fund management, setting a target of at least 10 percent annual increase in the market value of A-shares held by public funds over the next three years.

The CSRC announced accelerated efforts to implement a second batch of long-term stock investment pilots for insurance funds, with a planned scale of no less than 100 billion yuan ($13.7 billion). Building on existing initiatives, the CSRC aims to guide large state-owned insurance companies to significantly increase both their scale and actual proportion of investments in A-shares. Starting 2025, 30 percent of newly collected insurance premiums will be allocated for investment in A-shares.

Xiao Yuanqi, deputy director of the National Financial Regulatory Administration, detailed plans to optimize and enhance insurance fund investment policies. Insurance funds will be encouraged to gradually increase their proportion of investments in the stock market. Leading the charge, large state-owned insurance companies are expected to allocate 30 percent of their newly added premiums to stock market investments annually.

The aim is to steadily expand the presence of insurance funds in the stock market, building on an already solid foundation and ensuring that insurance funds play a significant role in stabilizing and developing the capital market.

In a parallel move to bolster the real estate sector, Xiao also announced that loan commitments for "white list" real estate projects have reached 5.6 tillion yuan ($769.4 billion) as of January 22. This underscores the government's dedication to stabilizing a vital component of China's economy.

The measures announced by the SCIO represent a strategic initiative to strengthen China's capital market by injecting more medium- and long-term funds. By expanding corporate pensions and directing a significant portion of new insurance premiums toward A-shares, the government seeks to enhance market stability and drive economic growth. These reforms reflect a proactive approach to fostering sustainable development across the financial and real estate sectors, ensuring long-term benefits for China's economy.

Earlier it was reported that Minister of Foreign Affairs of Kazakhstan Murat Nurtleu had received newly-appointed Ambassador of China to Kazakhstan Han Chunlin.