China Securities Regulatory Commission Photo: CFP
China's capital market regulator on Thursday pledged to step up efforts to further enhance policy stability,
MKsport transparency and predictability, improve the convenience of cross-border investment and financing, and enhance the attractiveness of A-share investment.
Wu Qing, chairman of the China Securities Regulatory Commission (CSRC), said at a press conference on Thursday that the CSRC will further optimize the Qualified Foreign Institutional Investor (QFII) program and enrich the supply of cross-border investment and risk management products. Moreover, it will continuously strengthen communication and contacts with international investors, and strengthen the building of regulatory capacity.
According to Wu, as of the end of last year, 866 QFIIs had received investment approval, and foreign investors held about 3 trillion yuan ($412 billion) in A-shares through the QFII and the Stock Connect program.
A total of 26 foreign-controlled or foreign-invested securities companies, fund companies and futures companies have been approved, Wu said.
Overall, the accessibility and stability of foreign investment in the A-share market has improved, helping foster a largely accommodative ecosystem for overseas investors joining China's capital market, Wu added.
Zhao Xijun, co-president of the China Capital Market Research Institute at Renmin University of China, told the Global Times on Thursday that the QFII program was designed to allow overseas investors to invest in China's domestic capital markets. This program allows qualified foreign institutions to invest directly in China's onshore securities markets, including stocks, bonds and mutual funds, under a quota system.
Multiple international financial firms, including Morgan Stanley and Standard Chartered, have recently announced the establishment of new branch companies in China or announced the latest progress of their local business expansions, indicating their growing attention to the Chinese capital market.
This highlights the growing appeal of the Chinese market for foreign investors, reflecting the increasing optimism and importance placed on it, Zhao said, adding that China's capital market is likely to remain a focal point for international investors seeking growth and diversification in their portfolios.
"Foreign capital plays a pivotal role in investing in the A-share market and contributes to the stable development of the market," Wu said, adding that a substantial share of foreign investment comprises medium- to long-term capital, which includes a notable presence of globally recognized sovereign wealth funds, pension funds, public mutual funds and commercial insurance funds.
Wu also emphasized that China's capital market will open wider, as the CSRC will continue to create a good investment environment for international investors and support the participation of various types of foreign-funded entities in the A-share market.
"China's economic outlook remains optimistic, and the capital market holds great development potential. We encourage more overseas investment to come to the A-share market to capitalize on opportunities arising from China's economic achievements," Wu said.
As China continues to promote its opening-up, targeting the capital market and the financial sector, more measures will be rolled out to create a better environment for global investors to participate in the Chinese market, Wang Peng, an associate research fellow at the Beijing Academy of Social Sciences, told the Global Times on Thursday.
China on Wednesday revealed a guideline outlining 20 measures to expand financial opening-up in the country's pilot free trade zones and a free trade port. The country will also support the purchase of certain types of cross-border financial services, facilitate inbound and outbound fund transfers related to foreign investment, improve arrangements for cross-border flows of financial data, and strengthen regulation of this sector, the guideline said.
