24.05.07 15:17 Age: 14 yrs
China will Triple QFII Quota to USD$30 Billion
Beijing, China - May 24, 2007
The Chinese government had made an announcement today that it will increase the quota for Qualified Foreign Institutional Investor (QFII) to USD$30 billion, following a two days Sino-US economic talks between China and its US counterpart in Washington.
The move is one of the several issues being discussed in the ongoing talks, adding that Beijing was also likely to lift the ceiling on the size of stakes foreign investors can hold in Chinese financial institutions.
China launched the QFII program in 2002 as part of its moves to open its local currency A-share market in Shanghai and Shenzhen, which have set a string of record highs this year.
Todate, China has granted QFII licenses to 52 overseas institutions, accordingly, 49 of the said institutions have received a combined USD$10 billion in the initial quotas with some USD$5 million left to allocate.
Media reports have said that several overseas QFII funds suffered heavy redemptions in the last few weeks due to growing concerns of a possible sharp correction in A-share prices.
(Source: China Daily)