China has temporarily halted a tie-up between the Shanghai and London stock exchanges, according to people familiar with the decision.
The move to suspend the Shanghai-London Stock Connect program was prompted by political considerations, and no timeline has been given for resumption of the scheme, the people said, asking not to be identified as the discussions were private.
The China Securities Regulatory Commission and the Shanghai Stock Exchange did not immediately respond to requests for comment, while representatives for the London Stock Exchange and UK treasury declined to comment.
The link between the two exchanges, designed to allow companies listed on one venue to issue shares on the other, has so far underwhelmed with just a single Chinese company listing in London and no UK companies coming to the Shanghai bourse.
The suspension signals deteriorating relations between the UK and China, at a time when British Prime Minister Boris Johnson’s government aims to strengthen trading ties with the world’s second-largest economy. The decision was previously reported by Reuters.
“I’m not aware of the specifics and would refer you to the competent authority and relevant businesses,” China foreign ministry spokesman Geng Shuang told reporters in Beijing on Thursday. “I would just like to stress that we hope the UK will provide a fair and just and open, non-discriminatory environment for Chinese businesses to invest there, and we hope it will create fair conditions for practical cooperation between the two countries.”
The UK’s stance on the Hong Kong protests was one of the issues that prompted the suspension, and a final decision on the Shanghai-London link would depend on how relations with the UK proceed, said one of the people.
The UK has repeatedly urged authorities to show restraint in Hong Kong, and has also accused China of torturing a former employee of the British consulate, drawing a rebuke from the Asian nation