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From Komfie Manalo, Opalesque Asia:
China plans to increase the limit on the amount foreign currency investors can invest under the Qualified Foreign Institutional Investors (QFII) to $1bn from the previous $800m, the State Administration of Foreign Exchange (SAFE) said.
In a statement posted on the government website, SAFE said the minimum quota of $20m for QFII investment remains unchanged.
Yang Taon, analyst at Guosen Securities, said the move would attract more overseas capital to China's financial markets and help build investor confidence, especially when the equities market fluctuated.
SAFE said it would seek opinion on the draft rules until September 18 before making the changes permanent.
The QFII program was introduced in 2002 by the China Securities Regulatory Commission (CSRC) and the People's Bank of China, the central bank, to provide for foreign capital access to the country's financial markets. QFII funds are allowed to invest in Chinese shares, treasuries, convertible and enterprise bonds.
According to CSRC statistics, 86 overseas investors were granted QFII status as of Augus17 this year. The investors poured in an estimated $15bn in local-currency stocks and bonds.
Draft rules to allow investors to channel more portfolio into China's capital markets
Hubert Tse, managing director with International Business Group Yuan Tai PRC Attorney, told the state's official me...................... To view our full article Click here
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