Beijing gives US firms 250-billion- yuan quota to invest in China’s capital markets
Beijing has given the US a quota of 250 billion yuan (HK$300 billion) to invest in China’s capital markets through offshore yuan, a senior central bank official said on Tuesday.
Through the renminbi qualified foreign institutional investor scheme (RQFII), US companies can use yuan accumulated offshore to tap China’s capital markets as Beijing embraces closer economic cooperation with the United States.
The step, announced by People’s Bank of China deputy governor Yi Gang at a briefing of the China-US Strategic and Economic Dialogue, further opens the domestic capital market.
The RQFII mechanism, launched in December 2011 to widen investment channels into the mainland, allows qualified investors to invest in securities and bond markets within quotas.
China’s central bank tightens reserve requirements for offshore yuan banks
The quota for the US seems to be the second largest offered to a jurisdiction. By the end of March, Beijing had allowed an accumulated quota of 1.21 trillion yuan to 16 jurisdictions including Hong Kong, South Korea, Singapore, France, Germany and Britain. Hong Kong holds the biggest quota, of 270 billion yuan.