China investment market snapshots 23 December 2010 The Australian Trade Commission – Austrade - has released two comprehensive guides on China’s regulatory schemes for investment – the Qualified Foreign Institutional Investor (QFII) scheme and the Qualified Domestic Institutional Investor (QDII) scheme. Both schemes operate through a quota system administered by the State Administration of Foreign Exchange (SAFE) and are transitional arrangements as China gradually liberalises its foreign exchange and capital markets. The QFII scheme was established in 2002 to allow qualified overseas investors to invest in A-shares, bonds and warrants listed on China’s domestic stock exchanges, securities investment funds, and other instruments permitted by the China Securities Regulatory Commission (CSRC). China has so far granted QFII licences to a total of 103 foreign institutions, including institutions from Australia, Hong Kong and Taiwan. The QDII scheme, which operates in reverse to the QFII, was formally established in 2006 to allow mainland China-based investors to invest funds overseas through approved banks, insurers, trust companies and securities firms in China. Investments can be made in products such as securities and bonds in overseas securities markets in 11 approved QDII jurisdictions, including Australia. To date, 87 mainland China-based firms have been approved to invest over US$66.9 billion on behalf of mainland investors. More information |