Well, talk seem to be gathering pace here between Beijing and Washington to avoid the de listing of Chinese companies from New York. And what it seems to be is that they're looking to let US inspectors travel here to Hong Kong and review these audit papers of Chinese businesses. Joining us now is Lu lu Chen, Bloomberg's Asia investing and real estate team leader. So, Lulu, we're reporting this, uh, and do we see this as a breakthrough happening or
is this just incremental progress on this story. So what we've been told is that Chinese regulators have instructed major accounting firms to prepare to bring the audit work papers UM to Hong Kong where they can be reviewed by the auditing board of the U s UM. For the US, my understanding is that nothing has changed. The SEC has always had a tough stance saying it's all access or nothing UM. So the progress is really from a development from kind of part where they are giving out these
instructions and it seems like there is some action on move. Yeah, we've seen we've seen progress in the past, kind of dissipate. You'd think that investors would be one bit and twice shy, but they are they are buying into this story, and I think it's important to report that we we don't have any comment from the SEC. We also don't have any comment from the China Securities Regulatory Commission. Uh So
it's it's very much up in the air. But progress is progress, and it seems like this this is a little bit of a breakthrough having US inspectors beyond somewhat neutral ground in Hong Kong Um. Yeah, it does seem like there is some progress. Something is happening, and I can understand why there is a there is pressure to get a deal out because the clock is ticking. Um. The post deadline for four is going to happen if they don't reach these agreements the end of the year. UM.
Auditing these papers will take time as well. And there's a lot of money at risk here. As of March, there were one point five trillion dollars worth of companies Chinese companies listed in the US, so a lot at stake here, Lulu. We know that Chinese companies can raise a lot of money in Hong Kong Um and they can raise money in China as well. Why is the
US so important to these companies. The US has always been a more UM preferred route for Chinese companies to list, especially for the tech companies and companies that have a less established model, especially a less established profit model. UM. Here in Hong Kong, you can see that the most of the companies that do well are traditional businesses, so that UM that sector UM, the new economy sector that has really created some of the world's largest companies. Traditionally
most of them have been listed in the US. There's a lot more liquidity UM in New York as well UM, and also UM the investor composition is just a lot more different institutional investors dominate the US UM New York Stock Exchange in NASTAC, whereas here in Hong Kong there there is UM less of that. So so I think like for companies and investment banks which make a bigger fee, the US has been the traditional preferred route. Lulu, thanks
very much for joining us. Here Live Lu lu Chen, Bloomberg's Asia Investing and Real Estate team leader