BIZCHINA / Top Biz News
Second batch of QFII about $6b
By Zhang Ran (China Daily)
Updated: 2007-03-24 09:44
The second batch of quotas for qualified foreign institutional investors
(QFII), a scheme for foreign players to invest in the A-share market, is
likely to be about $6 billion, an industry insider, who declined to be
named, told China Daily on Friday.
The source said that the second batch of QFII quotas was being discussed,
and pending approval by the Chinese government, was likely to be about $6
billion, not exceeding that of the last batch, which was $10 billion.
Hu Xiaolian, Deputy Governor of the central bank and Administrator of the
State Administration of Foreign Exchange (SAFE), said earlier that
related rules on the QFII scheme were being amended and the total QFII
quota would certainly see an increase in 2007.
However, she declined to give a specific sum.
China has so far approved 52 overseas institutions as QFIIs to invest in
the A-share market, of which 49 have got a combined investment quota of
$9.995 billion from SAFE, near the upper limit of $10 billion as
stipulated previously.
Industry insiders said the demand for QFII quotas was strong at present
and more should be granted.
"Despite the excessive liquidity in the A share market, the Chinese
government should grant more quotas to QFIIs. Otherwise, they will find
other ways, making it more difficult to supervise," She Minhua, an
analyst with CITIC China Securities said.
Meanwhile, the booming Chinese stock market is attracting more foreign
financial firms to set up joint ventures in the investment sector.
The Financial Times on Thursday reported that Nikko Asset Management, a
QFII approved in 2003, has become the first Japanese fund firm to acquire
a 20 per cent stake in a local firm, the Shenzhen-based Rongtong Fund
Management Company.
Nikko AM bought the stake from Shaanxi International Trust & Investment
(SITI), for 3.8 yuan per share, valued at 475 million yuan, according to
a statement by the Shenzhen-listed SITI.
(For more biz stories, please visit Industry Updates)
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