2019 is a year of great significance in the history of the Party and the country. It marks the 70th anniversary of China. Under the strong leadership of the Party Central Committee with Comrade Xi Jinping as the core, China has made sustained and sound economic and social development. Significant breakthroughs have been achieved in three tough battles. Major steps have been taken in reform and opening up. Supply-side structural reform is continuously deepened. Great progress has been made toward finishing the building of a moderately prosperous society in all respects, laying a solid foundation for achieving the first Centennial goal as scheduled.
A new chapter has been opened in the splendid era of endeavor. In 2019, the Shenzhen Stock Exchange (SZSE) thoroughly studied and implemented Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and the key ideas of the 19th National Congress, and the Second, Third, and Fourth Plenary Session of the 19th Central Committee of the CPC. We carried out activities on CPC education campaign themed “staying true to our founding mission”. Under the leadership of the China Securities Regulatory Commission, SZSE strived to make progress while ensuring stability, adhered to the New Development Philosophy, and took firm steps to deepen the structural reform of the financial supply side. Following the guidance of “four awes” (stand in awe of the market, rule of law, professionalism and risk-oriented thinking) and “one synergy” (the capital market’s development calls for efforts made by all sides), SZSE made in-depth efforts and yielded fruitful achievements in serving the real economy, preventing and mitigating risks, deepening market reforms, and actively supporting the development of Guangdong-Hong Kong-Macao Greater Bay Area and Shenzhen demonstration pilot zone for socialism with Chinese characteristics.
- New growths in direct financing. In this year, SZSE admitted 78 IPOs, with total listed companies reaching 2,205 and total market capitalization standing at 23.7 trillion RMB. The annual equity fund raised reached 508.93 billion RMB. SZSE welcomed more than 1,000 newly issued fixed income products on board, with total fund raised exceeding 1.7 trillion RMB and the amount of trusteeship reaching 2.1 trillion RMB. Promoting the quality of listed companies and supporting the development of private enterprises, SZSE further enhanced its ability to serve the real economy.
- New breakthroughs in market reform. Reform of the ChiNext Market and pilot of the registration-based IPO system have been pushed ahead. CSI 300 ETF options were successfully listed. The settlement model of ETF listed on SZSE market was comprehensively optimized. Other products launched include the first convertible panda bond, the first batch of special local bonds and corporate bonds for the development of the Guangdong-Hong Kong-Macao Greater Bay Area, and the first intellectual property securitized product. SZSE’s market functions have been constantly optimized, and the product system has been continuously improved.
- New progresses in risk prevention and control. Various measures have been taken to improve the effectiveness of supervision, and multiple aspects cooperated to prevent and control risks in key areas. The size of the stock pledge repurchase decreased by around 25% compared with the beginning of 2019. The number of companies pledged with a high proportion by controlling shareholders decreased by around 24%. Bond default risk has been controlled in a steady and effective manner, helping to guard against and defuse major risks of the financial sector.
- New steps in the opening-up. SZSE has been actively supporting the Belt and Road Initiative. With advanced, safe and reliable technology, Shenzhen Stock Exchange stood out from the competition of many technology system providers around the world and signed a trading and surveillance system cooperation agreement with the Pakistan Stock Exchange, spearheading export of Chinese technology systems for capital markets.
- New achievements in poverty alleviation. The poverty rates of two targeted-poverty alleviation regions-Wushan County, Gansu Province and Maigaiti County, Xinjiang Uygar Autonomous Region-dropped to 0.95% and 0.05% respectively, with 163,600 people lift out of poverty. Wushan County has been removed from the poverty list, contributing greatly to the task of eradicating extreme poverty by 2020 and to building a well-off society in an all-round way.
We would like to express our heartfelt gratitude to market participants, relevant organizations and all aspects that have long cared for and supported the development of the capital market and Shenzhen Stock Exchange!
The Fourth Plenary Session of the 19th Central Committee of the CPC proposed to consolidate the capital market’s fundamental system as an integral part of a modern financial system with high level of adaptability, competitiveness, and inclusiveness, and highlight the important role of the capital market in the modernization of the national governance system and governance capacity. The Central Economic Work Conference emphasized the need to optimize the fundamental system of the capital market, improve the quality of listed companies, steadily advance the reform of the ChiNext Market, and drew a clear path for high-quality development of the capital market. In response to the new situation and the new requirements, comprehensive reform has been deepened in the capital market at a brisk and steady pace, giving rise to new measures and policy synergy and providing impetus for the development of a rule-based, transparent, open, dynamic, and resilient capital market.
The tide rushes forward by chasing the wave ahead. 2020 is the year to realize a moderately prosperous society in all respects and to accomplish the “Thirteenth Five-Year Plan”. We are close to achieving the First Centennial Goal. Guided by the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, SZSE will stay true to its original aspiration and fold firm its mission, and conscientiously implement the spirit of the Fourth Plenary Session of the 19th Central Committee of the Party and the Central Economic Work Conference. Under the leadership of the CSRC, SZSE will make unwavering efforts to implement the New Development Philosophy, study and implement the newly amended Securities Law, advance and deepen the comprehensive reform of the capital market, step up the development of the fundamental system of the capital market, and contribute to high-quality economic development.
First, SZSE will uphold Party building as the priority and ensure that Party self-governance is fully exercised. SZSE will continue to give top priority to the political work of the Party, consolidate and deepen the fruits of the ongoing CPC education campaign. SZSE will keep firmly in mind the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment. We should strengthen our confidence in the path, theory, system, and culture of socialism with Chinese characteristics. We should resolutely uphold General Secretary Xi Jinping’s core position on the Party Central Committee and in the Party as a whole, and resolutely uphold the Party Central Committee’s authority and its centralized, unified leadership.
Second, SZSE will focus on reform and improve the ability to serve the real economy. We will accelerate the reform of the ChiNext Market and pilot the registration-based IPO system, improve ChiNext Market’s sector coverage and inclusiveness, and strengthen the ability to serve the new economy. SZSE will strengthen the development of its product system, ensure the smooth operation of the ETF option business, enlarge and strengthen core ETF products, continue to promote the issuance of high-credit bonds such as local government bonds and interest rate bonds, and move faster to innovate fixed income products.
Third, SZSE will uphold supervision, and prevent and resolve major risks. We will implement the action plan for improving the quality of listed companies, improve the supervision mechanism of listed companies with information disclosure at its core, and actively advance scientific supervision, categorized supervision, professional supervision and continued supervision. We will strengthen supervision of the entire trading process, and improve the accuracy, pertinence and effectiveness of trading supervision. We will vigorously promote technological supervision, and speed up the construction of supervision technology platforms. We will prudently handle and actively resolve risks in key areas such as equity pledges and bond defaults.
Fourth, SZSE will champion service as its purpose and advance the cooperation and cultivation of domestic and foreign markets. We will improve the ability of direct financing, assist in the reforms of state-owned enterprises, bolster the expansion and strengthening of private enterprises, technologically innovative enterprises, and growth enterprises leveraging on the capital market, and actively serve the dual-zones development of Guangdong-Hong Kong-Macao Greater Bay Area and Shenzhen demonstration pilot zone for socialism with Chinese characteristics. We will take solid steps to advance infrastructure interconnection, open and inclusive cooperation on product and business, and technical system services. We will prepare for the 2020 WFE Annual Conference with high quality, high standards, and efficiency, fostering opening-up on a larger scale and at a deeper level.
Fifth, we will focus on management, and improve the quality and efficiency of internal operations. We will champion the rule of law, promote open supervision, and build a transparent exchange. We will carry forward our fine conduct, inspire entrepreneurship, and build a high-quality professional team. We will stay focused and work with all aspects to promote the formation of a strong joint force to comprehensively deepen reforms of the capital market.
Reform and innovation is constantly gaining momentum. In 2020, SZSE will be a pioneer and innovator in its endeavor to advance capital market reform with a solid commitment, down-to-earth work style, and firm determination. SZSE will celebrate the 30th anniversary of its establishment with concrete efforts and the 40th anniversary of the establishment of the Shenzhen Special Economic Zone with hard work. We will constantly advance the cause of creating a world-leading innovative capital formation center and a world-class stock exchange.
