HK welcomes expansion of RQFII pilot scheme

The Hong Kong government Thursday said it welcomes the promulgation of the revised rules on the Renminbi Qualified Foreign Institutional Investor (RQFII) pilot scheme by the China Securities Regulatory Commission on March 6.

Under the revised rules, the types of institutions eligible for applying for RQFII have been enlarged to cover Hong Kong subsidiaries of Chinese mainland commercial banks and insurance companies or financial institutions which are registered and have major operations in Hong Kong.

Meanwhile, the investment restriction of RQFII funds has also been relaxed to allow institutions to design the types of products in accordance with market conditions.

Hong Kong's Financial Secretary John Tsang said the expansion of the RQFII pilot scheme to cover all Hong Kong-licensed asset management companies and relaxation of its investment restrictions would be conducive to the launch of more innovative and diversified Renminbi (RMB) investment products in Hong Kong.

This will further deepen the RMB offshore business in Hong Kong, and also enhance the cross-border use and circulation of RMB funds between the mainland and Hong Kong, thus promoting the internationalization process of the RMB, Tsang added.