Listings by Foreign-Invested Companies on Mainland Chinese Stock Exchanges Once Again in the Limelight

16 Pages Posted: 27 Oct 2008

See all articles by Eiichi Sekine

Eiichi Sekine

Nomura Institute of Capital Markets Research

Date Written: October 17, 2008

Abstract

Listing on a mainland Chinese stock exchange as an alternative to borrowing from a bank is once again in the limelight as foreign-invested companies in China face (1) borrowing limits and minimum capital requirements that depend on their total investment amount, (2) restrictions on borrowing overseas, and, (3) a tighter monetary policy since 2007. A number of foreign-invested companies have already issued and listed A shares on mainland stock exchanges, and the next step under consideration is to allow red chip companies to do this. For Japanese companies, the main incentive to list on a mainland stock exchange is to increase their local content and offer their employees more attractive incentives.

Keywords: Chinese stock exchange, foreign-invested companies, A shares

JEL Classification: F31, F33, F34,G15,G24,G31,G32

Suggested Citation

Sekine, Eiichi, Listings by Foreign-Invested Companies on Mainland Chinese Stock Exchanges Once Again in the Limelight (October 17, 2008). Nomura Capital Market Review, Vol. 11, No. 3, 2008, Available at SSRN: https://ssrn.com/abstract=1289226

Eiichi Sekine (Contact Author)

Nomura Institute of Capital Markets Research ( email )

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