China mulls allowing investment in overseas stocks, insurance, says foreign exchange official
China is studying the feasibility of allowing individual investors to buy overseas financial assets, according to an official from the foreign exchange regulatorIndividuals can spend up to US$50,000 per year on foreign currency purchases under current rules, but there are restrictions on buying overseas securitiesChina economyCissy ZhouandSidney LengPublished: 8:50pm, 19 Feb, 2021Why you can trust SCMP
China is considering plans to allow investment in overseas securities and insurance within the annual individual quota of US$50,000, a foreign exchange official said on Friday, in a move that could signal a slight easing of the country’s strict capital controls.
China will push forward with the opening up of its financial derivative market in 2021, Ye Haisheng, the head of capital account management department at the State Administration of Foreign Exchange (SAFE), told China Forex magazine, a magazine under the administration.
“We will study the impact on China’s balance of payments, yuan exchange rates and financial markets from overseas unconventional stimulus policies,” he said.
Under current rules, individuals can spend up to US$50,000 per year on foreign currencies for travel, overseas study or work, but there are strict limitations on capital outflows.
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For instance, Chinese individuals cannot directly invest in overseas stocks and bonds unless they are through banks or qualified institutional investors. Citizens are also banned from exchanging the yuan to buy property overseas.