China on Tuesday removed limits on foreign institutions wanting to invest in its stocks and bond markets, as it seeks to attract overseas investment amid a slowing economy and a trade spat with the United States.

Foreign individuals are barred from investing directly in China's markets, but the country allows certain institutions to buy shares under the so-called Qualified Foreign Institutional Investor (QFII) scheme.

The State Administration of Foreign Exchange (SAFE) said Tuesday it has removed the overall ceiling of $300bn on total asset purchases under this scheme, offering unfettered access to the world's second-largest capital market.

A cap on a yuan-denominated sister scheme -- the Renminbi Qualified Foreign Institutional Investor (RQFII) programme, which allowed overseas institutions to invest in Chinese securities using the offshore yuan -- was also removed on Tuesday.

"Foreign institutional investors with the relevant qualifications can remit funds to carry out investment in securities in compliance with regulations, greatly enhancing the convenience for foreign investors participating in the onshore financial market," the regulator said in a statement.

The regulator said it was also seeking permission from China's cabinet to scrap administrative licenses needed by foreign investors to purchase stocks and bonds.

The moves aim to "facilitate foreign investors to invest in the domestic securities market and enhance the depth and breadth of China's financial market opening," said Wang Chunying, a spokeswoman for SAFE.

Just over one-third of the $300 billion QFII investments quota had been used by end August, according to SAFE data.

Wang said that a yuan-denominated investment scheme, or RQFII programme, will now be open to all overseas institutional investors that meet certain requirements. Earlier it was only available to investors from certain countries or regions on a pilot basis.

China has recently eased restrictions on foreign investment in the financial sector, as the world's second-largest economy fights slowing growth at home and a damaging trade war with the United States.

China will remove shareholding limits on foreign ownership of securities, insurance and fund management firms in 2020, one year earlier than originally planned, the Financial Stability and Development Committee said in July.

Foreign investors will also be encouraged to set up wealth management firms, currency brokerages and pension management companies, the committee said.

Beijing has long promised to further open up its economy to foreign business participation and investment but has generally dragged its feet in implementing the moves.

In November, Beijing made an exception for two European insurers, allowing Germany's Allianz to launch a 100 percent foreign-owned subsidiary, and France's Axa to take control of its joint venture.

And in December, China's securities regulator authorized Swiss bank UBS to take a controlling stake in its local business.

Related Links
Global Trade News

Tweet

Thanks for being here; We need your help. The Space Media Network continues to grow but revenues have never been harder to maintain. With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords. Our news coverage takes time and effort to publish 365 days a year. If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.
SpaceMediaNetwork Contributor $5 Billed Once credit card or paypal		SpaceMediaNetwork Monthly Supporter $5 Billed Monthly paypal only

Hong Kong stocks surge after extradition bill withdrawal reports
Hong Kong (AFP) Sept 4, 2019
Hong Kong's stock market soared Wednesday after local media reported that the city's embattled leader is planning to fully withdraw a loathed extradition bill, one of the main demands of pro-democracy protesters. The Hang Seng index leapt more than three percent in afternoon trade after the South China Morning Post and HK01 both published reports that the city's pro-Beijing chief executive Carrie Lam was planning to shelve the bill. The semi-autonomous city has been battered by three months of h ... read more