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Screenshot of a breaking news alert e-mail from Q2 2017
A considerable amount of time has passed since Chinese government officials piloted a centralized operation of FX funds in the Shanghai Free Trade Zone, a region which is becoming a focus for overseas firms wishing to participate in Chinese business from within the mainland.
Today, the Chinese authorities have officially commenced foreign currency services under free trade accounts in the Shanghai Free Trade Zone, marking a major step forward in creating accessibility to China’s highly attractive, but until now impenetrable financial markets economy.
In addition to this representing another step towards the yuan’s free trade under capital accounts, analysts say the service could lower foreign exchange costs for companies.
During the pilot, local officials stated that the Shanghai Free Trade Zone would start a trial program for qualified individual investors to invest abroad, and permit limited amounts of the yuan to be used for free conversion within the year.
At the inception of the pilot last May, the operation of free trade accounts was only available to non-banking institutions, and such free trade accounts were made available in yuan, however Li Jun, Deputy Secretary-General of the China (Shanghai) Pilot Free Trade Zone Administration said at the time that foreign-currency business was likely to be launched within six months, however this has not yet been announced.