SHENZHEN is the ideal place for a NASDAQ-style growth enterprise market (GEM) and the time is ripe for the market to be launched now, Shenzhen delegates to the national legislature and advisory body said.

Li Lianhe, a Shenzhen deputy to the session of the National People’s Congress (NPC), said he will call for the establishment of a GEM, also known as the second board, in Shenzhen as soon as possible.

Li Decheng, a Shenzhen member of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), which opened its annual meeting Saturday, said in his proposal to the meeting that it is the right time to set up a GEM in Shenzhen.

Shenzhen Stock Exchange first proposed a GEM in October 2000. China’s policymakers in 2001 shelved the plan as the slump of technology shares overseas stoked fears the launch of the second board would be unsuccessful.

In 2004, the exchange launched a board to list small and medium enterprises (SME). The threshold for listings on the SME board remains the same with the main board.

In his proposal, Li Decheng said the SME board cannot meet the demand of a large number of high-growing companies, which want to raise money on a second board that requires lower threshold for listing.

According to Li, by the end of last October, China boasted 42 million small and medium enterprises, making up 99.8 percent of the country’s total number of enterprises. Yet enterprises with growth potential face a bottleneck in raising capital, for which the GEM board would be a solution.

Shenzhen would be the right location for the board, Li said. Shenzhen is famed for its booming high-tech industry. Among the city’s 30,000 science and technology firms, 1,438 were high-tech firms by the end of last year.

(SD News)