AP reporting – China has appointed Wu Qing, a former chairman of the Shanghai Stock Exchange, as the new head of its market watchdog, the China Securities Regulatory Commission (CSRC), replacing Yi Huiman.
This move comes amidst a prolonged downturn in Chinese financial markets, with stocks trading near 5-year lows despite efforts to stabilize them. Wu, nicknamed “Broker Butcher” for his tough enforcement of rules against market abuses, is a banking industry veteran and former vice mayor of Shanghai.
The markets in Shanghai and Shenzhen have struggled, partly due to heavy selling of property shares following a crackdown on excessive borrowing by developers. The CSRC recently announced a crackdown on insider trading, market manipulation, and other crimes to protect small investors. However, these efforts have not been sufficient to trigger a sustained recovery or regain investor confidence, with many expressing despair over their evaporating investments.
The decision to replace Yi may signal an attempt by China’s leaders to instill confidence in the markets, especially as the country approaches the Lunar New Year holiday, during which markets will be closed for a week.
This effort to calm the markets has gained urgency as top officials prepare to gather for the annual meeting of the national congress, where the Communist Party aims to showcase its leadership and set new financial targets. China faces both short and long-term challenges, including reforms needed to sustain robust economic growth amidst issues like the property market crisis and the fallout from COVID-19 lockdowns.
