China Suspends Stock Connect Program With UK Over Hong Kong Political Rift: Reuters

China has temporarily suspended the Shanghai-London Stock Connect project with the U.K. over the latter's support for Hong Kong protestors and other political rifts, Reuters reported on Thursday.

Benzinga · 01/02/2020 08:53

China has temporarily suspended the Shanghai-London Stock Connect project with the U.K. over the latter's support for Hong Kong protestors and other political rifts, Reuters reported on Thursday.

What Happened

The Stock Connect project launched last year in June enabled the companies from the two countries to list at each other's stock market and allowed investors to invest in either market.

Chinese securities broker Huatai Securities Co., Ltd. was the first to cross-list on the London Stock Exchange as part of the project, the South China Morning Post reported at the time.

In October last year, China's ambassador to the U.K. referred to the country's stance on Hong Kong as "two-faced" and "irresponsible."

Apart from the protests, the U.K.'s opposition to the detention of one of its consulate employees in Hong Kong, who was a Chinese citizen, may have also contributed to the decision, five people familiar with the matter told Reuters.

What's Next

Spokespersons from the LSE, the U.K.'s finance ministry, the China Securities Regulatory Commission and the Shanghai Stock Exchange all declined to comment on the matter, Reuters said.

China's Ministry of Foreign Affairs told Reuters that it wasn't aware of the specifics, but that it hoped that "the [U.K.] can provide a fair and unbiased business environment for Chinese companies that invest in the [U.K.] and create the appropriate conditions for both countries to carry out practical cooperation smoothly in various fields."

China has similarly opposed the U.S. efforts to support the Hong Kong protests, referring it to as an attempt to "meddle" in its "internal affairs," but hasn't let that affect its ongoing trade negotiations with the country.