BEIJING Oct 10 China's central bank will allow
foreign businesses to invest in domestic financial firms using
offshore yuan funding, it said on Thursday, as part of efforts
to broaden the usage of the currency in cross-border
Foreign businesses can invest their yuan revenues in
domestic financial firms in several ways, including by setting
up joint ventures or mergers or by buying stakes in domestic
firms, the People's Bank of China said in a statement on its
Any such investments will still need to be approved by
Chinese authorities, the central bank said.
Beijing has been stepping up efforts to attract offshore
money back into the country by relaxing investment restrictions
as capital flowing into its economy slows but outflows rise amid
slowing economic growth.
Under rules issued in 2011, foreign investors could invest
in domestic firms yuan profits made in China as well as yuan
funds from share transfers and asset sales that have been
remitted overseas, but not in the financial sector.
China's yuan is convertible under the current account, the
broadest measures of trade in services and goods. But it remains
under tight restrictions on the capital account, particular on
debt and portfolio investment.
(Reporting By Aileen Wang, Xiaoyi Shao and Jonathan Standing;
Editing by Kim Coghill)