China will strengthen risk monitoring and control to support the high-quality development of the futures market, said a circular approved by the State Council on Oct 11.

According to the circular, by 2029, China will step up efforts to build a regulation system and an overarching business framework in the sector, and form a safe, standard, transparent, open, dynamic, and resilient futures market system to attract full participation of global traders in major commodities in 2035.

As part of strict supervision over futures trading activities, work will be done to strengthen regulation through all trading activities with enhanced full-process monitoring on frequent transactions.

Meanwhile, severe actions will be taken to resolutely curb excessive speculative speculations and crack down on illegal behaviors in the market.

In terms of supervision of futures companies, efforts will be made to strengthen their equity management and corporate governance, regulate business operations of these companies and their subsidiaries, and improve the long-term mechanism for risk clearances, the circular said.

To strengthen risk prevention in the futures market, work will be done to enhance the risk prevention and early warning system with robust risk indicator monitoring across exchanges, markets, and borders, and improve the ability to deal with risks.

Measure also should be made to improve the effectiveness of commodity futures markets in order to serve the real economy, the circular said. To that end, the function of futures and share options will be fully explored.

The financial futures and derivatives market should be developed prudently, and steps will be taken to raise the level of development of financial futures and derivatives markets and deepen the regulatory reform of derivatives in the capital market, the circular said.

In addition, the opening-up of the futures market should be promoted steadily, with efforts to continue to expand institutional opening-up at a high level and strengthen regulatory capacity in an open environment.

The circular also noted coordinated supervision in the futures market with optimized allocation of futures supervision resources and better cross-departmental and cross-regional regulatory coordination.