By CGTN’s Cheng Lei

The A-share's recent inclusion in the MSCI index is the culmination of years of financial regulatory reforms, partly started by Laura Cha, chair of the Hong Kong Financial Services Development Council.

Cha was vice chairperson of the China Securities Regulatory Commission from 2001 to 2004, becoming the first non-mainlander to assume such a high-level role within the Chinese government. Now she is advising the Hong Kong Special Administrative Region government on regulatory reforms. 

Laura Cha made her first public appearance as vice chairperson of China’s securities regulator in Beijing on April 18, 2001. /VCG Photo

“When the market is doing well, no one wants to listen to reform.”

Cha has been called the “Iron Lady” from China’s financial regulator, as she always dares to foresee the market and push forward bold reforms.

The Hong Kong stock market had been burgeoning with record-breaking growth from 1999 to 2000, benefited from the Internet Revolution globally. People then were so thrilled by the stock yields when Cha discovered something odd and brought up a reform plan, which she takes great pride in now.

“I proposed to the government that with the constant battle between stock exchange and futures exchange those days, we should merge them, demutualize and take the company public,” Cha recalled, saying that she had a tough time forcing the proposal through as people were loath to try out reforms while the market was doing well.

VCG Photo

“It takes various factors to remain as an international financial center.”

As one of the world’s most important financial centers, Hong Kong seems to have lagged behind in Financial Technology (fintech), where mainland Internet companies are taking the lead.

“We [Hong Kong] have a disadvantage: We do not have enough tech people,” Cha said. That’s why the Hong Kong regulators have to launch policies to facilitate fintech, a disruptive element in financial services.

But that, according to Cha, won’t make Hong Kong any less of an international financial center.

“We rely not only on one element alone, it’s a whole package of various factors, among which the foremost is rule of law, and then the resources and products from the mainland,” according to the governmental adviser. “In other words, the pie is made bigger.”

“Fintech is no less, green financing is no less, but these are the things to add on. We need to keep our value to maintain our standard and attractiveness,” she added.

An illuminated night view seen from Victoria Harbor, Hong Kong, on August 30, 2016. /VCG Photo

“I hope the incoming HK administration will put green financing and the roll-out of the third board at the forefront.” 

Cha is still demonstrating her strong will as a reformer. She is pushing a quick roll-out of the third board and more green financing in the Hong Kong market.

“It’s a very competitive market, [where] if you don’t do it, others will be doing it” she said. Cha believes that the market is always ahead of regulators in both developing and mature markets in the world, so they have to act fast.