China turns to new stock exchanges to channel finance to innovative firms

CHINA’S ECONOMIC planners want more home-made semiconductors, but they are not satisfied with more chips simply being produced at home. They want to bring the entire supply chain—from raw materials and chip grinders to labour and capital—onshore. Tens of thousands of companies have established microchip businesses over the past year. Now the state is rushing to ensure such cash-hungry firms can raise capital at home, too.On September 2nd Xi Jinping, China’s president, announced that a new stock exchange will be launched in Beijing, joining existing markets in Shanghai and Shenzhen. It is hoped that the bourse, a revamp of an over-the-counter exchange called the New Third Board, will channel capital from professional investors to fast-growing small and mid-sized firms.