The China Macroeconomic Forum (CMF) Annual Conference (2025-2026) was held in Beijing on November 30. Li Yang, a member of the Chinese Academy of Social Sciences and Chairman of the National Institution for Finance & Development, emphasized that developing capital markets should be a priority during China's 15th Five-Year Plan period. He identified four key issues that need addressing:

1. **Balancing Investment and Financing**: Li Yang noted that China's capital markets have primarily served financing purposes—first aiding state-owned enterprises in overcoming difficulties, then supporting small businesses—but have largely neglected investors. This imbalance must be corrected.

2. **Expanding Derivatives Markets**: Developing derivative products is essential for market depth and risk management.

3. **Enhancing Listed Companies' Market Value Management**: Li Yang clarified that market value management is not about artificially inflating stock prices but involves optimizing operations, investments, and strategic adjustments to maintain healthy capital structures. This includes share issuance and buybacks to adjust shareholder structures and unlock value.

4. **Strengthening Cash Dividends and Share Buybacks**: Li Yang criticized the practice of frequent stock dividends (e.g., "10-for-5" or "10-for-4" distributions), which shifts responsibility away from companies. He advocated for cash dividends to provide investors with stable income streams. "If dividend yields exceed bank deposit rates, market downturns could be mitigated," he added.

Li Yang also highlighted the potential of asset tokenization (RWA), citing a recent agricultural product tokenization platform in Shenzhen that enables trading of high-value assets like ginseng, citrus, and apples. "This innovation holds immense promise," he remarked.

The forum underscored the need for reforms to align capital markets with investor interests and sustainable growth.