Beijing (AFP)
China has lifted a major restriction on foreign investment in the financial sector, a measure long demanded by the United States with which it is engaged in a trade showdown.
Foreign banks can now establish branches in China and hold all of the capital without necessarily partnering with a local partner, the banking regulatory authority (CBIRC) said on Friday.
Foreign banks had previously had to partner with a local partner and were not allowed to hold more than 49% of the joint ventures in which they had invested.
This announcement may appear as a gesture of goodwill from China towards the United States when a preliminary trade agreement between the two powers is to be signed in January, according to Washington.
The first two economies have been waging a merciless trade war since March 2018 which has resulted in mutual tariffs on hundreds of billions of dollars in annual trade.
Beijing has long promised to open up its economy more to foreign investment, but it was slow to honor its promise in the financial sector.
In October, China released a timetable for lifting several restrictions and in December, the Swiss bank UBS was authorized to take a majority stake in its activities in the country.
Since January 1, foreign companies specializing in futures contracts have been able to invest in China with no limits on capital.
Fund management companies will be able to benefit from this measure from April 1 and brokers from December 1, 2020.
© 2020 AFP