China Doubles Foreign Investment Quota to USD300 Billion to Invite More Traders
Chen Juan
/SOURCE : yicai
China Doubles Foreign Investment Quota to USD300 Billion to Invite More Traders

(Yicai Global) Jan. 14 -- China's  mainland is doubling its quota on investment from overseas stock traders  to buoy its capital markets that had a tumultuous year last year. 

China will lift the annual limit to USD300 billion from USD150 billion for qualified foreign institutional investors to satisfy the demand, the State Administration of Foreign Exchange said in a statement today. 

Offshore investors are showing an  increasing interest in Chinese equities despite the fact that major  mainland stock indexes logged double-digit declines last year. US-based  benchmark compiler MSCI started gradually including more and more  Chinese shares in its emerging market index since last June. China is  also ushering in its stock connect scheme between the two bourses of  Shanghai and London, to be launched potentially this month. 

The QFII scheme was launched in 2002 to  allow foreign traders to access Chinese stocks. The SAFE started  reforming the program in 2016 to ease regulation by lifting limits,  shortening lockup periods, and allowing foreign exchange hedging to  avoid currency risks.

Global financial firms such as  Zurich-based UBS, New York-headquartered Morgan Stanley, and Goldman  Sachs, have applied to join the program. 

Editor: Emmi Laine 

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Keywords: SAFE , Foreign Exchange , Qualified foreign institutional investor , QFII