It is hard to implement the "through train" plan due to the financial turmoil, but mainland investors can buy Hong Kong stocks through the Qualified Domestic Institutional Investor (QDII) scheme currently. AP

It will be more difficult to launch the investment "through train" program with the mainland amid the financial crisis, said Ronald Arculli, chairman of Hong Kong Exchanges & Clearing (HKEx).

"As I know, the program is still there. However, it will be more difficult to launch the scheme under the current financial situation," Arculli said yesterday at the fourth Asia Economic Summit in Hong Kong.

He added that mainland investors can still buy Hong Kong stocks through the Qualified Domestic Institutional Investor (QDII) scheme if they are interested.

"We are not sure about the progress of the 'through train plan' on the mainland," Arculli added.

However, Financial Secretary John Tsang stressed the "through train" plan, which allows mainland investors to trade stocks directly in Hong Kong, is still on track.

Mainland officials are currently examining the risks of launching the "through train" program, as it is difficult to start the scheme amid the financial crisis, Tsang said on Monday.

Regarding the HK$100-billion loan guarantees for enterprises except listed companies, announced by Chief Executive Donald Tsang on Monday, Arculli, also a non-official member of the Executive Council, believed the listed companies can raise their capital from different channels, not merely through the banks.

Asked if the Hong Kong Exchanges & Clearing will maintain its 90-percent dividend ratio, Arculli declined to give any details on the distribution of dividend.

"It is up to the Board of Directors to decide. At the moment, there isn't any update on amending the 90 percent ratio," Arculli said, adding that the company's year-end bonus will depend on the results of its annual performance.

Speaking at the fourth Asia Economic Summit, Arculli addressed the issue of setting up a rating agency in Asia to better assess the market in the region. However, he said it is not appropriate for the HKEx to act as the agency.

"It'd be better to ask private institutions to play this role, and the agency should also charge customers for its service," Arculli said.

He, however, noted that the dilemma of establishing the rating agency in Asia - whether it should be organized by private or government sector or by joint effort.

Talking about the global economic situation, Arculli said the worst is yet to come, as the banks maintain a tight grip on loans.

Arculli also shared Hong Kong's experience in monitoring short-selling, saying that short-selling only accounted for eight to 10 percent of the local stocks exchange's daily turnover.

(HK Edition 12/10/2008 page2)