Abb Takk News

China Scraps Foreign Investment Cap In Stocks, Bonds

BEIJING: 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.