Shanghai to give money managers access to assets in private markets to rival Hong Kong for global capital

Name: China’s economy expands record 18.3 per cent in the first quarter of 2021
Uploaded: 2021-05-26T04:21:49.000Z
Duration: 2 min 1 s
Description: China’s economy expands record 18.3 per cent in the first quarter of 2021

Expansion in QFLP and GDLP schemes from June 1 will open doors to assets in private markets for local, foreign investors

Shanghai aims to become one of the top global hubs for asset management by 2025, document says

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Motorists seen under the large electronic board showing the latest stock market data in Shanghai in May 2021. Photo: EPA-EFE

Zhang Shidongin Shanghai

Published: 12:21pm, 26 May 2021Updated: 10:56pm, 26 May 2021

Shanghai will give “qualified investors” access to a wider array of assets in private markets from next month under the city’s pilot investment schemes, just as appetite is surging among global money managers.

Under the Qualified Foreign Limited Partner (QFLP) scheme, foreign investors will be allowed to buy shares in unlisted companies, as well as participate in private placements by listed companies, private equity and venture capital products, according to a statement on Tuesday.

Under the Qualified Domestic Limited Partner (QDLP) scheme, mainland investors will be able to access assets ranging from stocks and bonds issued by private companies, as well as invest in securities, commodity and financial derivatives, it said.

The measures will give the nine-year-old investment schemes a makeover and empower China’s biggest commercial city in its effort to become a global asset management hub. It came just as foreign investors bought a record 21.7 billion yuan (US$3.4 billion) of local stocks on Tuesday via the southbound Connect scheme with Hong Kong.

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China’s economy expands record 18.3 per cent in the first quarter of 2021

It will also lift investment restrictions and promote the internationalisation of the yuan as the Shanghai Stock Exchange seeks to rival Hong Kong for global capital. Hong Kong is the favourite venue for global stock offerings in seven of the past 12 years, where sustained market reforms have lured a spate of jumbo listings.