China allows offshore yuan to be invested in private equity-paper

SHANGHAI Wed Oct 24, 2012 9:08pm EDT

SHANGHAI Oct 25 (Reuters) - China has allowed overseas investors to buy stakes in unlisted companies in the country using offshore yuan, part of Beijing's efforts to promote international use of the Chinese currency, the Shanghai Securities News reported on Thursday, citing unidentified officials.

The Hong Kong unit of Haitong Securities Co and Bank of Shanghai plan to raise up to $100 million in China's first fund under the so-called Renminbi Qualified Foreign Limited Partner (RQFLP) scheme, initially launched in Shanghai, the newspaper said.

The program is an extension of Shanghai's Qualified Foreign Limited Partner (QFLP) scheme, which allows overseas investors to buy stakes in unlisted companies using foreign currency.

The RQFLP would widen investment channels for investors holding yuan offshore, and would also help Shanghai become an international financial hub, according to the article.

In a bid to promote yuan's global status, China has already allowed overseas investors to make foreign direct investment and securities investment in China using Chinese currency held offshore. (Reporting by Samuel Shen and Kazunori Takada; Editing by Eric Meijer)

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