Financial regulators flag measures to incrementally open capital account
China’s financial regulators will implement a wave of measures to incrementally liberalize the capital account.
Speaking at the Lujiazui Financial Forum on Wednesday, chairman of the securities regulator (CSRC), Wu Qing, said he will increase the number of futures and options products qualified foreign investors (QFIs) can invest in “as soon as possible.”
- Separately, the CSRC said that QFIs will be permitted to invest in exchange traded fund (ETF) options, starting October 9.
Wu also said the CSRC and central bank (PBoC) will explore launching RMB futures.
- RMB futures contracts are currently traded offshore, but not in mainland China.
Additionally, Wu said the CSRC will look for new ways to:
- “Allow global investors to more fully…share in China's innovation and development”
Also speaking at the forum, director of the foreign exchange regulator (SAFE), Zhu Hexin, said his agency will roll out policies that:
- Support scientific research institutions’ efforts to attract foreign capital
- Expand cross-border financing for tech firms
Zhu also said SAFE would encourage firms to borrow foreign debt to fund green projects, on a trial basis.
Additionally, SAFE will issue a new batch of qualified domestic institutional investor (QDII) quotas “in the near future.”
- Under the QDII program, mainland savers can invest in overseas capital markets.
- The quotas were last expanded in May 2024.
Get smart: While these measures are incremental, the emphasis on two-way investment flows – facilitating both inbound foreign investment and outbound deployment of domestic capital – reflects a genuine intent to deepen China's market access.
- Expect more targeted liberalization in the coming months, particularly in areas aligned with policy priorities, like tech and green finance.