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China allows more foreign investment in financial sector

China allows more foreign investment in financial sector

In a statement posted by the central bank today, the Financial Stability and Development Committee said China will remove shareholding limits on foreign ownership of securities, insurance and fund management firms in 2020, a year earlier than originally planned. 

The statement said foreign investors will also be encouraged to set up wealth management firms, currency brokerages and pension management companies. It also said that foreign-owned credit rating agencies will also be allowed to evaluate a greater number of bond and debt types

Beijing has long promised to further open up its economy to foreign business participation and investment. US President Donald Trump has launched a damaging tariff war in an attempt to force Beijing to further open up its economy and limit what he calls its unfair trade practices.

The US and China have hit each other with punitive tariffs covering more than USD 360 billion in two-way trade. Donald Trump and Chinese President Xi Jinping agreed to revive fractious trade negotiations when they met on the sidelines of the G20 summit in Japan on 29th June and the top US and Chinese negotiators have held phone talks this month.