中国股票市场发展：从香港和其他亚洲市场中获得教训
肖耿
1.中国证券市场的成就
在十多年的时间里，中国已经建立起一个发育完全、配备现代化直接金融机制的股票市场，对银行系统统领性的间接融资功能形成了竞争与补充。这显然是人们在十年前很难预料到的成就。
股票市场的发展有助于减少中国企业的负债与权益比率（Debt／Equity Ratio），改善它们的资产结构。这对中国企业及银行系统的改革十分重要。
目前，从中国两个股票市场的IPO里筹集到的资金已经超过了日本。2001年，上海和深圳股票市场筹集资金是香港的两倍。从2001年年初开始，上海和深圳的市场资本总额已经超过了香港的市面价值，成为日本之外的亚洲股市中的老大。
6000多万中国持股者正在投资1000多家本国的上市公司。中国的市场资本总额已经上升至GDP的50％左右，赶上了韩国和日本。随着中国股票市场规模的扩大，其基础结构也有了相应的发展。上海与深圳的股票市场已经完成了惊人的转变，甚至赶超香港。
在过去的几年中，我们在市场规范领域看到了明显的进步，其中证监会及其他政府机构，还有大众传媒都发挥了重要作用。有些人或许会指出，在这一期间中国公司股指的表现令人失望。对此，我们应该以更长远的眼光来看待，并且和同一地区的其他市场作对比。
事实上，如图表所示，如果我们比较1997年6月至2002年12月之间的亚洲市场表现，会看到只有中国的持股者有所获利，其他市场的投资者都损失了其股票价值的30％到85％。
我相信统计数据是该地区真实经济状况的写照。
2.产权界定与执行的重要性
在讨论细节之前，我希望强调一下中国金融市场的核心问题在于产权的界定和执行。
金融市场是实际经济（real economy）的派生物。证券交易则是不动产（real asset）产权交易的派生物。
运作良好的金融市场不仅依赖于清晰的产权和金融手段（financial instrument）契约的有效执行，也严重依赖于对重要不动产产权的界定和执行。无论股票市场的机制与法规多么先进，一旦某块土地或其他资产的虚假所有权和虚假证明出现，将摧毁上市公司的全部价值。
从对清晰产权和有效执行的需求看，证券市场以其直接、即时的融资特性处在市场经济金字塔的最顶端。投资者在对上市公司进行投资时并未受到任何担保。在购买股票之后，他们没有足够的时间观察并介入上市公司行为。一旦金融市场或上市公司有风吹草动，他们将直接获利或者遭受损失。
欺骗的诱惑是可怕的，得与失都因为它变得巨大且直接。证券市场是最需 要警察和清晰、透明规则的地方，清晰、可执行的产权也起到最关键的作用。
消费者在购买前检验产品；雇主和雇员在共同工作中增进了解；购房者清楚地了解房产的位置、设计和周围环境；银行对其贷款持有担保并且监督客户。只有证券市场的投资者完全凭着他们对产权的信任进行投资，而产权的界定和执行由现存经济体制完成。
在与物权界定和执行相关的长链在某一段断开的时候，证券市场很容易出现问题。证券市场内部的产权界定和执行不仅与金融法规的制定者有关，还和一系列其他法规制定者、服务提供者和股票持有者相关，比如会计、律师、法官、警察、投资者、政府等。这就是为什么像美国市场这样的顶级股票市场也会反复出现问题的原因。
作为世界上最自由的市场经济体，香港已经发展了一整套最先进的产权系统。大多数自然资产和金融资产的所有权和证明已被明确备案。市场也对其进行系统、持续的评估且极少收到政府干预。交易备案良好，低税政策得到法制体系的保护和强制执行。世界级的国际金融、会计、法律公司在现代的、西方式的体制中为产权界定和执行提供服务；一支强大的警力和一支世界上最杰出的反腐队伍ICAC（反腐独立委员会）作为后盾。这是一个包括中国大陆在内任何发展中经济体梦想拥有的体制。而这个产权系统的背后是香港成为亚洲头号国际金融市场的成功。
但和美国一样，即便在相对完备的产权系统中，香港的证券市场也会出现问题。最弱的环节通常出现在跨国境的产权界定与执行当中。和美国一样，香港需要继续完善产权体系。
中国证券市场的发展面临着许多挑战。这些挑战通常围绕在证券市场的四大功能周围：资源配置、价格发现、公司治理和风险管理。
3.协调储蓄与投资
以在资源配置上的角色的规模来看，中国股票市场发展面临巨大挑战。中国银行系统资产与GDP的比率高达160％，高过股票市场资产化的3倍。目前，银行储蓄的一大部分（占中国GDP的20％到30％）难于找到生产性的（productive）投资。
这意味着，如果股票市场能在协调储蓄和投资方面比银行做得更好的话，其规模会再提高GDP的20％到30％，也就是几千亿美元。
显然中国有足够的国内储蓄供股票市场进一步扩张。股市发展的真正挑战和银行系统一样：如何在储蓄和最盈利、最具生产性的投资者之间发现有效通道。为此，股票市场依赖市场推动有效、可靠的价格发现、公司治理和风险管理的能力。
4.股价扭曲之源
中国政府依然在股票市场发挥重要影响力，这在中央计划经济和国家控制的历史背景下并不奇怪。有些政府影响会削弱股票市场的价格功能。这在迅速发展的市场中很普遍。在政策、开放和宏观经济条件出现问题的时候，价格扭曲现象甚至在成熟的股票市场存在。
问题在于，在中国为了符合WTO要求持续放开经济时，在股票市场日益成熟复杂时，投资者和公司会逐渐以其他国际市场作为衡量中国股市价格功能的基准。在这样的前景与发展下，现有价格扭曲现象将构成股市进一步发展的主要障碍。包括我的同事宋敏教授在内的很多学者指出，以下几种价格扭曲现象最为关键。
∙由于一方面政府对IPO的数量、价格和时间严格控制，另一方面企业大量申请对上市和IPO注册，造成IPO过程和价格的扭曲。
∙由于国家和其他国家机构持有大量非交易股（高达总量的2／3），造成市场和股票价格扭曲。
∙由于对上市私营企业和外资企业的限制和严格控制，造成市场结构和股票总价的扭曲。
∙由于一方面专业管理和正确规范的投资基金匮乏，另一方面几乎没有规范、高投机的信贷、金融公司的积极参与，造成市场和股票价格的扭曲。
∙由于缺乏买空卖空机制和派生产品，造成市场和股票价格的扭曲。
∙由于现存的对不同类型持股者的割裂的、区别的对待，造成缺乏透明的兼并和通过股市进行的股权交易。
近些年来，市场力量和规范改革越来越有效地减少以上形式的价格扭曲。 过去几年中，深圳、上海的市场质量显著提高，股票价格在整体上趋于理性。 尤其是这些市场已经能够迅速、强制性地执行处罚上市公司曝光的市场操纵和不正当行为。
5.“家长”应放手
股票市场的质量最终取决于上市公司和其他市场参与者的质量。股市给上市公司施加压力，促使它们改善自身的公司治理。在这一方面，股市无疑起到了很大作用。中国的股市监管当局制定了与经济合作暨发展组织（OECD）规章相似的管理规章和条例，在促进公司治理方面做了许多工作，而且这些工作也的确起到了很大的作用。
但是由于存在上文提到过的股市定价功能的扭曲，市场调节规律很难充分发挥在公司管理方面的作用。我个人认为，关键还是在于对产权和激励机制（incentive）的描绘和执行。我已经多次提过，政府可以在一定限度内持有大型企业的股票，例如20％或者30％以下。但是政府必须放弃对企业的绝对控制，这样市场力量才能够真正地引导、监督企业的行为。
由于国家所有制企业、国家控股上市公司、主要银行国有、主要证券交易所国有是当今的普遍现象，严重的利益冲突依然存在，而且不仅仅局限于政策制定方面，也体现在产权、法律和管理条例的执行上。传统上，政府一直扮演投资公众的家长的角色，这也增加了中国政府从各个集团的利益冲突中抽身而出的难度。
6.低风险的吸引力
中国股市的定价和公司治理问题是所有新兴市场的通病。这些新兴市场问题代表了国内投资者所面临的系统性、结构性风险，因为国内投资者没有能力通过在国内市场作多样性投资避免这些风险。中国解决这些风险的途径有以下几种：
1.减少定价扭曲、改善公司治理是惟一的降低系统和结构性风险的长远之计。这一点得到越来越多的认同，已经成为政策制订者和市场参与者一项开始实施的工作。
2.令更多优秀私营和外资企业上市将有助于减少系统性和结构性风险。这一现象已经在中国逐步缓慢发生。我在此之前已经多次指出，让优秀的私营和外资公司上市不止是为他们提供接触资金的机会。对许多真正优秀的公司来说，他们需要的也许不是资金。优秀公司的上市更是打造中国股市的声誉，向投资者提供更多的优秀公司以供选择的问题。随着全球化的进程，优秀公司已经能够接触到海外的市场，全世界各地的股票交易所都在争夺优秀的公司，希
望他们在自己的交易所上市。这种竞争给所有的股市都施加了压力，迫使他们改善自己的质量。
3.另外一个以市场为引导的解决办法就是允许投资者向外国市场作多样性投资。在香港、美国这样市场发达的国家和地区，这种做法非常普遍。也是出于这个考虑，政府持有、管理外汇储备（holding and managing foreign exchange reserves with foreign assets）以避免出口收入下降的风险。
香港和日本的经验也许能够说明最后一点。香港的投资者能够很容易地在任何国际市场作多样性投资，这一事实令我认为，香港股市的长期系统性、结构性风险相对而言比较低，也有限。与纽约、伦敦股市的上市公司相比，在香港上市的公司的市盈率并不高。香港的投资者很明显可以以国际标准为基准，衡量香港上市各股的定价。事实上，随着中国股市不断的改善，香港的投资者也可以很容易地把资金转投到中国市场。
另外一个多样性投资降低国内风险的好例子是日本。自1989年以来，日本每年在股市投入的净对外投资在5万亿至12.5万亿日元（400亿至1000亿美元）之间波动（按1美元＝125日元计算）。日本现在之所以成为世界上的大债权国，国外资产达到360万亿日元（3.9万亿美元），相当于日本一年的GDP值，这一多样性战略也起到了一定作用。这些海外资产无疑有助于日本应对日本国内的结构性风险。正是结构性风险导致了日本长达十年的发展停滞、政府负债／GDP比值超过140％。
当然，在海外市场作多样性投资要求宽松的固定资产帐户和更高的人民币可兑换性。后者是一个复杂的政策发展过程，需要时间进行政策设计和实施，不在本文讨论范围之内。
7.从亚洲吸取教训
二战之后出现的亚洲经济奇迹主要发生在贸易和制造业。随后是亚洲的金融危机。随着中国加入世贸组织，低关税和非关税壁垒再加上贸易额上升，亚洲贸易系统将会更加富有活力。随着西方和亚洲其他地区向中国的直接投资额的上升，技术和技能的地区性融合也在顺利开展。
亚洲经济发展的瓶颈很明显在于亚洲储蓄与投资缺乏相互转化的机制。亚洲金融市场的不完整制约了亚洲提供资本市场基本、正常功能的能力，如资源分配、价格发现、风险管理和公司治理。和中国一样，亚洲各国国内将近1／3的存款没有用作生产性用途（productiveuse），要么躺在银行里，要么被借给政府，或者向海外投资。日本银行的利率极低，很明显是鼓励低回报甚至无回报的投资。而亚洲地区股市的不完整也说明，这些股市没有从规模经济、范围经济、和高流动性中获利。亚洲金融市场（例如日本市场）的价格扭曲就算没有彻底打消将市场作为公司治理的一个关键做法的可能性，至少也增加了这么做的难度。亚洲银行系统里的高额不良贷款以及外汇体制的脆弱性也正是未来的金融危机的根源。
亚洲，包括日本，已经在黄金发展期建立了强有力的制造和出口业，却没能建成强大的金融业。创造亚洲奇迹的资金很大程度上来自外国直接投资和出口。中国需要吸取这个教训，利用高速发展时期的机遇来打造一个强有力的金融行业。正如本文所强调的那样，做到这一点，需要发展一个明晰的产权系统，以及产权、合同的有效执行。
（本文为北京大学中国经济研究中心与香港大学经济金融学院于2003年1月18日—19日联合举办的“中国证券市场与金融体制改革理论研讨会”论文。刊登于2003年1月20日发表的《二十一世纪经济报道》周刊。作者系香港证券及期货事务监察委员会研究顾问，原稿为英文，黄洁、刘弋译）
Draft: 15 January 2003
China’s Securities Market Development:
Lessons from Hong Kong and Other Asian Markets
Xiao Geng1
Achievements of China’s securities market
In a little more than a decade’s time, China was able to develop a full-fledge stock market with modern direct financing mechanism to compete and supplement the dominant indirect financing function of the banking system. This is clearly a great achievement few had expected a decade ago. The development of stock markets has clearly helped to improve the capital structure of Chinese enterprises by reducing their debt-equity ratio. This is important for both enterprise and banking reforms in China.
Funds raised from IPOs in China’s two stock markets are now larger than those raised in Japan. In 2001, Chinese enterprises raised about two times more capital from Shanghai and Shenzhen markets than from Hong Kong market. Since early 2001 the combined market capitalisation of Shanghai and Shenzhen have also grown larger than the market cap of Hong Kong, becoming the largest in Asia-ex-Japan.
Today more than 60 million Chinese shareholders are investing in more than 1000 listed Chinese companies. China’s market capitalisation is also rising to about 50% of GDP, catching up with those in Korea and Japan.
As the scale of stock markets in China increases, their infrastructure also catches up quickly. Shanghai and Shenzhen stock markets have already achieved script-less transaction, well ahead of Hong Kong.
In the last few years, we have also seen clear improvement in the area of market regulation not only by CSRC but also by other government agencies and also with critical help from the public media.
Some of your may point out that the performance of the stock market index in China has been disappointing during the last few years. We need to take this into perspectives by taking a longer horizon and by comparing with other markets in the region. The author is Adviser of Research at Securities and Futures Commission of Hong Kong and
Associate Professor at the School of Economics and Finance, the University of Hong Kong. This paper expresses the author’s personal views and does not necessarily represent the views of the Securities and Futures Commission of Hong Kong.
1
Stock Market Performance in Asia Stock Market Indices% change end Jun 97 end Dec 02 in local currencyin USD
Shanghai A1,3071,4198.68.8 ShenzhenA449410-8.8-8.6 India1,1921,094-8.3-31.6
Korea745628-15.8-37.2 Hong Kong15,1979,321-38.7-39.1 Singapore1,9211,341-30.2-42.4
Japan20,6058,579-58.4-59.8 Malaysia1,077646-40.0-60.1 Taiwan9,0304,452-50.7-60.4
Thailand527356-32.4-61.3 Philippines2,8091,018-63.7-82.2 Indonesia725425-41.4-84.1
In fact, as shown in the above table, if we compare the performance of the stock markets in Asia between June 1997 and December 2002, on average, only China’s shareholders have some gains, while all investors in other Asian markets lost from 30% to 85% of their value in stocks. This I believe is a statistical picture much closer to that of the real economy in the region.
Delineation and enforcement of property rights critical to securities market
Before going into details, I would like to emphasize that the core issue about financial market development in China is the delineation and enforcement of property rights.
Financial markets are derivatives of the real economy. The trading of securities is a derivative of the exchange of property rights over real assets. Well functioning financial markets rely not only on clear property rights and effective enforcement of contracts with regards to the financial instruments but also critically depend on delineation and enforcement of property rights over underlying real assets. No matter how advanced the securities market institutions and regulations are, a fake title or a fake certificate about a piece of the land or other assets would destroy all the value in a listed company, when discovered.
Securities market is at the top of the pyramid of a market economy in terms of the requirement on clear property rights and effective enforcement because of its nature of direct and immediate financing. Investors are given no collateral in their financing of listed companies. They have no time to observe and then intervene in the behaviour of the listed companies after buying the stocks. They gain or lose immediately following the actions not only in the financial market but also in any activities of the listed companies and of any other parties providing services to the listed companies.
The temptation to cheat is so big since the gains or losses could be so huge and so quick. This is where you need the best police and most clear and transparent rules. This is where clear and enforceable property rights matter the most.
Consumers can examine the products before purchasing. Employers and employees do work together and know each other over time. Homebuyers know the location, the design, and the physical conditions of the real estate. Banks hold collateral on their loans and inspect their clients. However, investors in the securities markets invest
entirely on their trust in the property rights, as delineated and enforced by the existing system of the economy.
Securities markets can easily go wrong when any part of the long chain of activities necessary for the delineation and enforcement of property rights is broken. The delineation and enforcement of property rights in the securities markets involve not only financial regulators but also an array of other regulators, service providers, and stakeholders, such as accountants, lawyers, judges, police, investors, and the government. This is why even the most advanced securities market, the U.S. market, could go wrong, and repeatedly in history.
Hong Kong as the World’s freest market economy has developed one of the most advanced property rights system. Most physical and financial assets have clearly documented titles and certificates. The market through free and open transactions also assesses their value systematically and continuously with little intervention from the government. The transactions are well documented and taxed at a low tax rate in order to get the protection and enforcement by the legal system. World-class international companies in finance, accounting, and law are available for providing services on the delineation and enforcement of property rights under a modern and western-style legal system, a strong police force as well as arguably the World’s best anti-corruption force, ICAC (Independent Commission Against Corruption). This is a system any developing economies, including Mainland, would dream to have. This system of property rights is behind Hong Kong’s success in becoming Asia’s leading international financial market.
But, like the U.S., Hong Kong’s securities market could also go wrong even under a well-established system of property rights. In the case of Hong Kong, the weakest links are usually in the cross-border delineation and enforcement of property rights. Most of Hong Kong’s listed companies are incorporated overseas. Many of them are Mainland companies, including the recent waves of Minying firms. This creates challenges for protection and enforcement of property rights and contracts. The strength of the property rights system depends on the weakest links in the long chain of activities for the delineation and enforcement of property rights. This is why even Hong Kong and the U.S. need to work hard in improving its property rights systems (or sometimes referred fashionably but narrowly as corporate governance).
There are many challenges facing China’s securities market development. These challenges can be organized around the four functions of the securities market: resource allocation, price discovery, corporate governance, and risk management.
Resource allocation
The challenge for China’s stock market development is huge in terms of its scale and its role in resource allocation. China’s banking sector assets/GDP ratio is as high as 160%, more than three time of the stock markets capitalisation. At the present, a large portion of the bank deposits, perhaps as much as 20% to 30% of China’s GDP, has difficulties in finding productive investment. It means that if the stock markets could do better than the banking system in intermediating savings and investment, the scale of stock market could increase for another 20% to 30% of GDP or several hundred billion US dollars in the near future.
Clearly there are ample domestic savings to support the expansion of the stock markets in China. The real challenge to the stock markets development in China is the same as that to the banking system: how to channel savings efficiently to the most profitable and productive enterprises and projects. Effective intermediation of savings and investment through the stock markets depends on the markets’ capability in facilitating efficient and reliable price discovery, corporate governance, and risk management.
Price discovery
The Chinese government is still having significant influences on the stock markets. Given China’s history of central-planning and state control on the economy, this is no surprise. Some of these government influences may distort the pricing function of the stock markets. This is common for emerging markets. The price distortions could exist even in the mature stock markets due to problems in policy, openness, and macro economic conditions.
The issue is that as China continues to open its economy under the WTO requirement and as the stock market participants becoming mature and sophisticated, it is likely that the investors and enterprises would increasingly benchmark the pricing function of China’s stock markets with those of other international markets. Given this future trend of development, the existing price distortions may become major barriers for further development of China’s stock markets. The key price distortions may include the following as pointed out by many scholars including my colleague Professor Frank Song in one of his papers:
• Distortion to IPO process and prices due to tight control on the number, price and timing of IPOs by the government on the one hand, and large demand on listing by enterprises and on subscription to IPO by investors, on the other hand;
• Distortion to markets and stock prices due to large amount of non-tradable shares (as high as two thirds of the total), by the State and other state-controlled institutional shareholders;
• Distortion to market structure and overall stock prices due to restriction or tight control on listing of private and foreign invested enterprises;
• Distortion to markets and stock prices due to shortage of professionally managed and properly regulated investment funds on the one hand, and active participation of hardly regulated and highly speculative trust companies, finance companies, and enterprises on the other hand;
• Distortion to markets and stock prices due to lack of short-selling mechanisms and derivatives products.
• Lack of transparent merger and acquisition transactions conducted through the stock markets, due to existence, fragmentation and different treatments to
different shareholder types and concentration of state ownership in listed
companies.
In recent years the market forces and regulatory reforms have been working more and
more effectively in reducing the above distortions to the markets and stock prices. In
last few years the quality of markets in Shanghai and Shenzhen improved
significantly and the stock prices became more rational on the whole. In particular,
the markets have been able to punish and discipline quickly and forcefully the
exposed market manipulations and improper behaviour by the listed companies.
Corporate governance
The quality of markets depends ultimately on the quality of listed companies and
other market participants. The stock markets are certainly useful in providing
pressures for listed companies to improve their corporate governance. The regulatory
authorities in China have done a lot in promoting good corporate governance by
establishing rules and guidelines similar to the OECD standards. These efforts are
certainly helpful.
But given the above distortions to the pricing function of the stock markets, it is
difficult for the market discipline to play its full role on corporate governance. In my
own view, the key is still in the delineation and enforcement of property rights and
incentives. As I have suggested in many occasions, the government could own stocks
of large enterprises up to a certain limit, say below 20% or 30%, but have to give up
its absolute control on the enterprises so that the market forces could really guide and
check their behaviour.
Given the prevalence of majority state ownership and state control of the listed
companies, major state banks, and major state-owned securities brokerage houses,
there are serious conflicts of interest not only in making policies but also in the
enforcement of property rights, laws and regulatory rules. The traditional paternalistic
role of the State for the investing public makes it even more difficult for the Chinese
government to detach itself from the conflicts of interest among different groups.
Risk management
The pricing and corporate governance problems in China’s stock markets are typical
of all emerging markets. These emerging market problems represent systematic and
structural risks to domestic investors, as they could not deal with these risks through
diversification within the domestic markets. China could reduce these risks in a
number of ways:
• Reducing pricing distortions and improving corporate governance are the only
way to reduce systematic and structural risks in the long run. This has been
increasingly recognized as an on-going task for policy-makers and market
participants.
• Listing more quality private and foreign invested companies would help to
reduce the systematic and structural risks. This is happening slowly in China. I
have pointed out in many occasions before that the listing of good private and
foreign invested companies is less about giving them access to capital. For
many really good companies, they may not need the capital. It is more about
building the reputation of China’s stock markets and giving investors more
quality companies to choose from. With globalisation, quality companies now
have access to overseas markets for listing and all stock exchanges in the
world are competing to get them listed in their own markets. This competition
is creating pressures for all stock markets to improve their quality.
• Another market-oriented way to deal with systematic or structural risks in
domestic markets is to allow investors to diversify their investment into
foreign markets. This is a common practice for investors in the developed
markets such as in the U.S. and Hong Kong. It is also the principle behind
holding and managing foreign exchange reserves with foreign assets (to hedge
against the risks of declining export income).
The experiences of Hong Kong and Japan may be useful in illustrating the last point.
The fact that the investors in Hong Kong can easily diversify their investment into any
international markets leads to my believe that the long-term systemic and structural
risks of stock markets in Hong Kong is relatively low and limited. The price-earning
ratios of companies listed in Hong Kong are not high compared to those in New York
and London. The investors in Hong Kong apparently are able to benchmark their
pricing of Hong Kong listed stocks on international standards. Indeed, as the quality
of stock markets in China improves, investors in Hong Kong can easily switch their
investment into China markets.
Another useful example on diversifying domestic risks is Japan. Since 1989, the
annual net outward investment in securities markets by the Japanese has fluctuated in
the range of 5 trillion to 12.5 trillion yen or US$ 40 to 100 billion (at 125yen/dollar).
Partly as a result of this diversification strategy, Japan is now a huge creditor to the
rest of the world with external assets of more than 360 trillion yen or US$ 3.9 trillion
(at 125 yen/dollar), which is close to one year’s GDP in Japan. These huge external
assets would certainly help Japan to deal with its domestic and structural risks that
have led to a stagnation of growth for more than 10 years and a government debt/GDP
ratio of more than 140%.
Of course, diversification into overseas markets requires capital account relaxation
and greater RMB convertibility, which is a complicated policy development and
needs time for careful policy design and implementation and is beyond the scope of
this paper.
Lessons from Asia
The post World War II Asia miracle was primarily in trade and manufacturing sectors
and was followed by the Asian financial crisis. With China’s accession to the WTO,
the trade system in Asia will be more robust with low tariffs and non-tariff barriers
and rising trade volume. The regional integration of skills and technology is also
going smoothly given the rising foreign direct investment into China from the West as
well as from Asia.
The bottleneck of economic development in Asia is clearly in the intermediation of its
savings and investment. Asia’s fragmented financial markets limited its ability to
provide basic and normal functions of the capital markets: resource allocation, price
discovery, risk management, and corporate governance.
Like in China, about one third of the domestic savings in Asian economies could not
find productive uses and have to either sit in the banks or to be lent to the government
or to be invested overseas. The extremely low interest rate in Japan clearly encourages
investment with low or no return. The fragmentation of the region’s stock markets
also implies that they have not benefited enough from economies of scale, scope, and
integrated high liquidity. The price distortion in the Asian financial markets, such as
in Japan, makes it difficult, if not impossible, to use markets as one of the key
discipline for corporate governance. The high non-performing loans in Asia’s
banking system and the fragility of their exchange regimes are still roots for future
financial crisis.
Asia, including Japan, has developed strong manufacturing and export sectors during
its golden period of growth but largely failed to develop a strong financial sector. The
financing of the Asian miracle is largely by foreign direct investment and exports.
China needs to draw lessons from this and use the window of opportunities during its
high growth period to develop a competitive financial sector. As emphasized in this
paper, this requires the development of clear property rights system and effective
enforcement of property rights and contracts.
Financial Markets in East Asia: Key Indicators
Exchage OTC
Index on Daily Derivatives
World World Quality of Debt Equity Market Average Daily Average
Competitiveness Competitiveness Productivity per Financial Bank Assets Securities Capitalization Turnover Turnover
RankingScoreGDPWorkerInfrastructure/GDP/GDP/GDP/GDP/GDP
[***********][***********]April 2001
UnitUS$ billionUS$%%%%%
USA1100.010,205.671,858.38.9962.9147.5136.42.52.8Singapore581.185.644,934.37.58243.540.5135.2118.084.7HKSAR977.8161.952,605.27.75215.327.9312.641.432.1Australia1474.1367.255,218.29.06262.643.6102.214.213.8New Zealand1966.549.143,297.7 187.726.936.38.16.9Taiwan2461.3282.252,911.37.50262.319.8103.71.40.6Malaysia2659.787.522,273.36.55208.293.5136.00.11.0Korea2756.8422.239,617.16.73232.967.346.12.40.9Japan3054.34,143.852,779.08.67139.2153.154.63.53.2China Mainland3152.21,159.17,375.3 160.028.445.40.00.0Philippines4041.571.410,644.54.1488.533.529.81.40.8Indonesia4726.9130.37,285.83.52156.52.317.63.10.4Source: World Competitiveness Yearbook 2002, IMD; Tables in the chapter; FIBV, BIS and websites of the central banks and ministries of finance in the region; Gordon de Brower's paper on "Financial Markets, Institutions and Intergration in East Asia".
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