Wu Qing elaborates on the five major directions for high-quality development of the capital market during the "14th Five-Year Plan," with leading public fund managers and securities firm chiefs providing in-depth analysis!

Everyday Economic News Reporter | Li Lei Everyday Economic News Editor | Zhao Yun

On March 6, the Fourth Session of the 14th National People’s Congress held a press conference focused on the economy. Wu Qing, Chairperson of the China Securities Regulatory Commission, systematically explained China’s achievements in the development of the capital market during the 14th Five-Year Plan period and clarified the core direction for high-quality development of the capital market during the 15th Five-Year Plan period. He proposed to focus on promoting qualitative improvements and reasonable quantitative growth in the market, striving for five new enhancements.

The “Daily Economic News” reporter noted that in response to the policy signals released during this speech, several key participants in the capital market, including fund companies, also provided industry perspectives, highlighting the central role of the capital market in serving Chinese modernization and building a strong financial nation.

Quantitative and qualitative leaps in the “14th Five-Year” capital market
The stock market’s “barometer” role becomes more prominent

Wu Qing introduced at the press conference that during the “14th Five-Year” period, under the strong leadership of the Party Central Committee and the State Council, the CSRC, together with relevant parties, thoroughly implemented the new “Nine Regulations,” actively responded to multiple internal and external challenges, and promoted the capital market’s risk prevention, strengthened regulation, and high-quality development in an integrated manner.

A series of key data confirm the development achievements of the capital market: during the “14th Five-Year” period, stock and bond financing on exchanges reached 64 trillion yuan, with the proportion of direct financing increasing to 31.97%, up 3.2 percentage points from the end of the 13th Five-Year Plan, indicating profound changes in the social financing structure.

Of this 64 trillion yuan in financing, 5.9 trillion yuan was from stock financing, including IPOs and refinancing, while cash dividends from the stock market during the same period reached 10.7 trillion yuan, reflecting the continuous development of the market’s investment function. As of now, the total market value of A-shares exceeds 110 trillion yuan, over 5,400 listed companies have annual revenues exceeding half of China’s GDP, and the weighting of strategic emerging industries in the CSI 300 index accounts for 45%, with the momentum for new and high-quality development continuously gathering. In terms of capital structure, holdings by public funds, social security, insurance, and pension funds of A-shares’ circulating market value have increased by over 50%, and the market’s investment and financing functions are increasingly coordinated.

Fuguo Fund stated that at the start of the 15th Five-Year Plan, the government work report reiterated the goal of “raising the proportion of direct and equity financing.” This is not merely a cyclical policy echo but a strategic leap of the capital market from being a “financing tool” to becoming a “foundation of the innovation ecosystem”—under the new coordinates of building a strong financial nation, direct financing is shifting from a financing channel to a resource allocation hub.

Further analysis by the institution indicates that in each transition, the capital market has undergone a reshaping of its role—from periphery to hub, from tool to main body. Over the past five years, the proportion of direct financing has risen to 31.97%, an increase of 3.2 percentage points from the end of the 13th Five-Year Plan; equity financing reached 5.9 trillion yuan, with cash dividends of 10.7 trillion yuan, forming a preliminary market pattern of coordinated investment and financing functions; the proportion of strategic emerging industries in the CSI 300 index has reached 45%, with the “new and high-quality” feature continuously strengthening; the share of medium- and long-term funds has increased to 50%, significantly enhancing the market’s internal stability. These quantitative and qualitative improvements lay a solid foundation for deepening reforms during the 15th Five-Year Plan.

Yuan Chuang, Chief Economist at CICC Securities, also pointed out that overall, the scale, structure, and quality of the capital market are experiencing new leaps, with driving forces for new and high-quality development continuously gathering. The market’s resilience and risk resistance capabilities are also markedly improving. The stock market’s role as a “barometer” is becoming more prominent, playing an increasingly important role in stabilizing employment, enterprises, markets, and expectations.

The “15th Five-Year” plan targets five major directions for high-quality development
Precisely serving new productive forces

Wu Qing pointed out that the “15th Five-Year” period is a critical stage for laying a solid foundation and making comprehensive efforts toward the basic realization of socialist modernization, as well as a key phase for the capital market to move toward high-quality development. The CSRC will work with relevant parties to implement the “14th Five-Year” plan, focusing on serving Chinese modernization and building a strong financial nation, coordinating risk prevention, regulation strengthening, and high-quality development, and striving for five new improvements.

First, the market will be more resilient and more stable.

“Stability is the overall goal, the premise, and an inevitable requirement for high-quality development of the capital market.” This is Wu Qing’s core positioning on stable market development. He proposed that the CSRC will continue to promote the effective coordination of all parties, improve the “long-term investment” market mechanism and ecosystem, enhance the characteristic Chinese stability mechanisms, enrich cross-cycle countercyclical adjustment tools and mechanisms, and further strengthen the market’s internal stability.

Principal Economist Yan Xiang of Founder Securities analyzed that promoting a more resilient and stable market requires joint efforts in two aspects: stabilizing the internal structure and ensuring external institutional guarantees.

On one hand, improving the investment ecology and investor structure can fundamentally reduce endogenous market volatility; on the other hand, enriching the toolbox for cross-cycle countercyclical adjustments, normalizing risk monitoring and early warning systems, and building “firewalls” and “shock absorbers” to respond to extreme shocks can effectively suppress irrational market fluctuations and prevent risk contagion. This, combined with the endogenous stability brought by “long-term investment,” can jointly promote market stability and long-term development.

Second, the system will be more inclusive and better suited.

Regarding institutional development, Wu Qing proposed deepening comprehensive reform of investment and financing, further improving the basic systems of the capital market, actively developing diverse equity financing channels, expanding exit options for private equity and venture capital funds, strengthening bond, REITs, and asset securitization markets, continuously enriching products and tools to better serve the development of new productive forces, and steadily developing futures and derivatives markets to better meet corporate and household risk management needs.

Hua Xia Fund pointed out that the more the capital market needs to enhance its inclusiveness and adaptability for developing new productive forces, the more important the role of public funds as key participants. Public funds should improve their contribution to the development of new productive forces, acting as “ballasts” and “stabilizers.” On one hand, they should promote technological innovation through direct investments in related fields; on the other hand, they should emphasize the signaling role of their sci-tech innovation funds, strengthening existing funds’ quality and strength, and issuing more thematic funds covering industries related to new productive forces to guide financial resources toward key core areas and truly hard-tech innovative enterprises.

Third, the quality of listed companies will be higher, and their structure more optimized.

Listed companies are the core carriers of the capital market. Wu Qing emphasized that improving the quality of listed companies should focus on continuously ensuring their “authenticity” and further enhancing their “investability.”

Fourth, regulatory enforcement and investor protection will be more powerful and effective.

Wu Qing stated that the CSRC will adhere to rule of law in market governance, promote the soundness of the legal system for the capital market, and advance market reform and development on the rule of law track; accelerate digital and intelligent regulation, precisely and effectively crack down on illegal activities such as financial fraud, market manipulation, and insider trading; and continuously improve the system for protecting investors’ legitimate rights and interests.

Fifth, opening-up will advance to deeper and higher levels.

Wu Qing noted that international investors’ asset allocation needs are increasingly diverse, and the attractiveness of “Chinese assets” has significantly increased. In this context, the CSRC will focus on creating a first-class market-oriented, rule-of-law, and internationalized business environment, aiming to improve cross-border investment and financing convenience, further advancing two-way opening in markets, products, services, and institutions, and creating a more transparent, stable, and predictable market environment. It will also actively participate in international financial governance reform, strengthen cross-border regulatory cooperation, and continuously enhance regulatory and risk prevention capabilities under open conditions.