China removed one more hurdle for foreign investment into its capital markets almost 20 years after it first allowed access.
Global funds no longer need approvals to purchase quotas to buy Chinese stocks and bonds, the State Administration of Foreign Exchange said in a statement on Tuesday. It removed the $300 billion overall cap on overseas purchases of the assets, about two-thirds of which remain unused.
It’s the latest push by Chinese authorities to increase use of the yuan in international transactions, and comes as they seek out more foreign capital to balance payments. Scrapping the investment quota is also another step in policy makers’ efforts to open up China’s financial system to the world.
Separately, the country has allowed foreign banks and insurers to take controlling stakes in their local ventures. UBS Group AG, JPMorgan Chase & Co. and Nomura Holdings Inc. have all won approval for majority control of their local securities joint ventures, while Goldman Sachs Group Inc. and DBS Group Holdings Ltd. have applications pending.
Source : Bloomberg