China will increase fourfold a program that allows investors to bring in yuan raised overseas to meet demand for the nation's securities.
The China Securities Regulatory Commission, the People's Bank of China and the State Administration of Foreign Exchange have agreed in principle to increase the quota for the Renminbi Qualified Foreign Institutional Investor program by 200 billion yuan ($32 billion), Guo Shuqing, chairman of the securities regulator, said at a briefing in Beijing yesterday. Hong Kong officials asked for the amount to be lifted, Guo said. The current quota is 70 billion yuan.
China approved the RQFII program last December, allowing the Hong Kong units of Chinese financial companies to raise yuan offshore for investment in domestic capital markets. Guo has cut trading fees, pushed companies to increase dividends and allowed trust companies to buy equities since becoming chairman a year ago in an effort to shore up the stock market.
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