Focus on UK Investment Immigration and the UK Economy: According to a report by the Financial Times on January 7, Beijing time, Ashmore Group has become the first overseas company outside of Hong Kong to announce that it has obtained a license for direct investment in China's $34 trillion stock market and $4.7 trillion bond market.
China has granted unprecedented freedom to a Western asset management company to invest in its capital markets, marking another step towards the goal of opening its capital markets.
The agreement between Ashmore, a constituent of the FTSE 250 Index, and the China Securities Regulatory Commission is part of the outcomes from UK Chancellor George Osborne's visit to China last October. Under the new Renminbi Qualified Foreign Institutional Investor (RQFII) program, China has provided an investment quota of 80 billion yuan (approximately $13 billion) to the UK, with a total RQFII quota of 180 billion yuan. As part of the agreement, Ashmore's investment quota could reach several hundred million yuan.
Christoph Hofmann, Global Distribution Head at Ashmore, stated that this is another significant milestone in China's opening up to external investors.
The new RQFII program offers overseas companies nearly complete freedom to invest in the Chinese market. Previous programs forced overseas fund managers to invest half of their assets in the stock market, with a 12-month lock-up period for investments, and repatriation of funds required approval.
Ashmore manages $78.5 billion in assets and plans to launch a fixed income fund that will purchase a range of Chinese bonds before investing in the stock market. HSBC will act as the custodian bank, holding investor assets, controlling electronic payment records, and performing administrative duties.
