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January 25, 2005
You are on the invidual archive page of Reds ain't red. Click Simon World weblog for the main page.
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Reds ain't red
A small story to illustrate just how economically liberal China can be. China halved duty on share trades in order to lift the market. With Chinese share markets at 5 year lows the markets in Shanghai and Shenzhen have been the worst performing in the world. Problems such as poor disclosure, non-existant corporate governance, poor auditing, patchy data, fraud, an overhang of state shares don't help. Stock duty has been cut to 0.1% from 0.2%, lower than the UK's 0.5% levy. Tax competition: it sounds almost capitalist. But if China is enjoying such a boom, why is its share market at 5 year lows? posted by Simon on 01.25.05 at 10:33 AM in the
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Comments:
You'd think those shares would be higher, wouldn't you? Especially with all the money supposedly being made. My guess is that the public knows that very little of the money will actually make it to the shareholders. Thanks again for hosting the Asia Blogs awards. I think it got more attention for all of us! posted by: Sam_S (ShenzhenRen) on 01.25.05 at 04:41 PM [permalink]That is a really fascinating question you just posed. I never focused on the stock market performance in China. I agree, you'd think that with such a huge economic expansion, people would be buying Chinese equities hand over fist. But that's not happening. I put it down as a total vote of no confidence. On the other hand, US companies and I bet Australian companies with significant revenues from China are doing pretty well on their respective exchanges. As always, provocative stuff, Simon. posted by: RP on 01.25.05 at 09:05 PM [permalink] |
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