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UK-listed firms can sell shares in China for the first time | Business News



UK-listed companies will be able to sell shares in China for the first time from today as the London-Shanghai Stock Connect service opens.

The initiative forms part of the countries’ efforts to build greater economic ties as China looks to open markets despite the trade war with the US and the UK prepares for life after Brexit.

It will give international investors the opportunity to invest in over 260 of 1,500 Shanghai-listed companies – those seen as eligible to participate – for the first time as they are able to secure a stock market listing in London.

UK firms can do the same in China – bolstering access to shares in each country and allowing firms to raise capital.

A sign denotes the entrance to The London Stock Exchange
Stock Connect is being launched in the City

Chinese brokerage Huatai is the first company expected to make its full London debut on Monday, with investors in London getting the opportunity to trade global depository receipts in the company.

Closer financial services ties with Beijing take place at a time when global trade growth is slowing and governments are cautious about Chinese state interference in corporate entities.

The UK is still considering the potential involvement of Chinese tech giant Huawei in the country’s 5G network as the US and many other major powers block the company’s technology on spying fears.

The launch of Stock Connect is being marked during a visit to London by Chinese vice premier Hu Chunhua.

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Shanghai skyline
Shanghai is China’s main financial centre

Chancellor Philip Hammond is due to say at the London Stock Exchange launch: “London is a global financial centre like no other, and today’s launch is a strong vote of confidence in the UK market.

“Stock Connect is a ground-breaking initiative, which will deepen our global connectivity as we look outwards to new opportunities in Asia.”

He attended a conference in the Chinese capital in April to promote Beijing’s multibillion-dollar Belt and Road Infrastructure structure programme to develop new land and sea routes with the West.

Mr Hammond said then his aim was to help win lucrative financial, legal and design services contracts for UK firms.

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