Britain and Beijing in talks about yuan quotas
UK financial secretary for treasury says the two sides keen to hold talks on RQFII scheme
The British government is in talks with Beijing about the granting of quotas to financial institutions in the City of London that would give their offshore yuan deposits access to the Chinese market.
In a push to globalise its currency, China has been developing an offshore yuan market to give global firms, banks and asset managers entry into its domestic market. Its renminbi qualified institutional investor scheme allows them to trade in the bond and equity markets.
Beijing said in July it would allow companies in London and Singapore to participate in the RQFII scheme.
However, no London-based company has yet been approved and Beijing has not announced further details about application procedures.
"Clearly there are further discussions that need to take place with the [Chinese] authorities on the implementation and elaboration of the breakthrough [RQFII] we made … that is a work in progress," Britain's financial secretary to the Treasury, Greg Clark, said yesterday.
To obtain an RQFII quota, a foreign firm needs approval from China's securities and foreign exchange regulators. Clark (pictured) said the British and Chinese authorities were keen to facilitate talks on RQFII as there was "great appetite on both sides" to extend the quota.