| China to loosen restrictions on QDII overseas investment |
| Saturday,March 31,2007 Posted: 03:19 BJT(1919 GMT) chinaview |
BEIJING, March 30 (Xinhua) -- China plans to loosen restrictions on qualified domestic institutional investor (QDII) investment targets so that they can invest in new sectors, said Li Dongrong, vice director of the State Administration of Foreign Exchange (SAFE) on Thursday. Li made the remarks at the 2007 China Derivatives Summit. He said that together with the China Banking Regulatory Commission and the China Insurance Regulatory Commission, SAFE is mulling over the selection of potentially profitable new sectors. The SAFE is also considering including securities companies in the QDII system. QDIIs are currently allowed to invest only in fixed-return financial products. China's QDII program is still in its infancy and the products are not selling well because of the narrow investment scope, high risks, low profits and poor accessibility, he said. Furthermore, investors -- both companies and individuals -- would rather hold Renminbi than convert them into foreign currency because the yuan keeps on appreciating. China launched the QDII system in July 2006, allowing QDIIs to raise Renminbi funds from domestic individuals and institutions and buy foreign currency from the SAFE for overseas investment. So far, 30 financial institutions -- 11 domestic banks, seven foreign banks, 11 insurance companies and one mutual fund -- have been granted QDII status. |
| (Source: English Site of Lagos) |
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